Research › Search › Judgment

Kerala High Court · body

2016 DIGILAW 783 (KER)

DEPUTY GENERAL SECRETARY STATE BANK OF INDIA UNION v. DEPUTY GENERAL MANAGER STATE BANK OF INDIA, ZONAL OFFICE, ERNAKULAM

2016-09-09

ANIL K.NARENDRAN, P.R.RAMACHANDRA MENON

body2016
JUDGMENT : Ramachandra Menon, J. The verdict passed by the learned single Judge, whereby Ext. P5 Award passed by the 3rd respondent/Central Government Industrial Tribunal cum Labour Court - Ernakulam in I.D. No. 225 of 2006 was set aside, is under challenge in this appeal preferred by the Union representing the workers/staff of the Willington Island Branch of the State Bank of India - the Management. By virtue of the said judgment, stoppage of the 'Special Compensatory Allowance' paid @ Rs.15/- and Rs.25/- per month to the sub-staff and clerical staff respectively [which was intercepted by the Tribunal] came to be upheld holding that the employees represented by the Union are not eligible for the 'Special Compensatory Allowance' since such allowance is not being paid to any Central Government employees working in Willington Island, which was cited as the basis/norm as per Clause 9 (a) of the Settlement dated 08.09.1983. 2. The case has got a long history. As conceded by the Union in Ext. P1 claim statement filed before the Tribunal/Labour Court, 'Special Compensatory Allowance' was granted to the employees working in the branch of the State Bank of India at Willington Island on 26.04.1968 with retrospective effect from 01.08.1966, allegedly on the basis of 'paragraph 5.8' of the Agreement dated 31.03.1967 executed between the Management and the Union. By virtue of passage of time, payment of such allowance had become a part of the service conditions, which could not have been unilaterally altered by the Management. However, in the year 1985, when the Management proceeded with steps to withdraw the said benefit unilaterally, it was sought to be challenged by filing O.P. No. 7170 of 1985, wherein an interim order of stay was passed. Similarly, in respect of such step with reference to the Ambalamedu branch of the respondent Bank, the move was sought to be resisted by filing O.P. No. 8986 of 1985, wherein also an interim order of stay was passed. During the pendency of the above proceedings, the said benefit was withdrawn in respect of Peechi branch of the respondent Bank with effect from 01.02.1987, which led to an industrial dispute before the Industrial Tribunal, Alleppey, where it was numbered as I.D. No. 28 of 1988. During the pendency of the above proceedings, the said benefit was withdrawn in respect of Peechi branch of the respondent Bank with effect from 01.02.1987, which led to an industrial dispute before the Industrial Tribunal, Alleppey, where it was numbered as I.D. No. 28 of 1988. The reference was answered by the Tribunal passing an Award to the effect that the action on the part of the Management Bank was violative of Section 9A of the Industrial Disputes Act, the change having been introduced without complying with the mandatory requirement of issuing a notice of 21 days' as stipulated therein. Pursuant to the said Award, the employees were given the said benefit, particularly the arrears. The O.Ps. were disposed of on the basis of the Award passed in the said I.D. In furtherance to the bipartite discussions, the benefit which was being paid to the employees of the Ambalamedu and Peechi branches was subsequently withdrawn, as the said branches were functioning in the 'project areas' and that the projects having been completed, the status of the 'project area' itself was lost. Admittedly, the Union co-operated with the Management in this regard, as conceded in paragraph 4 of the claim statement, however adding that payment of allowance was continued in the Willington Island branch. 3. In the course of further proceedings, the Management Bank issued Section 9A notice under the Industrial Disputes Act on 15.12.1994 proposing to withdraw the benefit with effect from 15.01.1995. Though the Union raised an objection in this regard and a complaint was filed before the Assistant Labour Commissioner [Central] on 28.12.1994, the proposal was implemented as per order dated 25.01.1995 and the benefit was withdrawn. This made the Union to raise a dispute and pursuant to the reference under Section 10 (1) (d) of the I.D. Act, it came to be numbered as I.D. No. 6 of 1997 (C) before the 3rd respondent Tribunal/Labour Court. Ext. P1 claim statement was submitted by the Union as mentioned already and the Management Bank filed Ext. P2 written statement pointing out that the course pursued by them was perfectly within the four walls of law. Ext. P1 claim statement was submitted by the Union as mentioned already and the Management Bank filed Ext. P2 written statement pointing out that the course pursued by them was perfectly within the four walls of law. It was stated that there was a Bipartite settlement between the Management of 58 Banks represented by the Indian Banks Association and the Workers represented by the concerned Unions and that as per 'Clause 9' of the said Settlement dated 08.09.1983, Special Area Allowance was to be paid only subject to the conditions stipulated therein, at the prescribed rate, with reference to the workers/staff posted at places specified in Schedule No. III, w.e.f. 01.03.1981. It was also stipulated in sub clause (a) of the said Clause that the allowance payable at any place shall be discontinued, if such allowance [called by any name whatever] ceased to be payable to the employees of the Central Government. Still further, as per sub clause (b) of Clause 9 it was made clear that the allowance will continue to be payable at the stipulated rate only until such time, as there was no direction to the contrary from the Government and thereafter, subject to such direction. It was asserted in the written statement that the employees of the Bank working in the Willington Island branch were never entitled to have the allowance as aforesaid and hence it was to be discontinued, more so, since no Central Government employee working in any Central Government office in the Willington Island was receiving such Special Area Allowance. 4. In response to the contents of Ext. P2 written statement, Ext P3 reply statement/rejoinder was filed by the Union, virtually reiterating their stand as contained in Ext. P1 claim statement. Evidence was adduced by examining WW1 from the part of the Union and marking documents as Exts. W1 to W7, whereas MW1 was examined from the part of the Management, simultaneously marking Ext. M1. After hearing both the sides, the Tribunal/Labour Court observed in paragraph 5 of the Award that 'one has to fall back to the original position when the benefit was granted in order to know the reason for granting the special allowance'. Observing that the Management had not substantiated the position with regard to the adverse circumstances in relation to the Willington Island, especially in relation to boarding, lodging, transport, communication, hospital facility, etc. Observing that the Management had not substantiated the position with regard to the adverse circumstances in relation to the Willington Island, especially in relation to boarding, lodging, transport, communication, hospital facility, etc. as on date, while deciding to withdraw the benefit in comparison with the position as existed in the year 1966 when the allowance was paid for the first time, the matter was intercepted. The Tribunal/Labour Court further held that, if the Management wanted to implement its proposal, it could be done only by a 'bilateral settlement' and not by a unilateral decision like the order under challenge. The Tribunal/Labour Court also held that no much reliance could be placed upon the communication issued by the Customs Authorities to the effect that the Central Government employees of the Customs Department were not being paid any Special Compensatory Allowance. Clause 9 (a) of the Settlement dated 08.09.1983 was interpreted by the Tribunal/Labour Court holding that same would not support the Management Bank, as it would be applicable only if the allowance was being paid to the employees of the Central Government and if it comes to be stopped subsequently. It was held that the Central Government Employees of the Customs Department were never being paid the allowance and as such, Clause 9 of the Settlement dated 08.09.1983 could not be pressed into service by the respondent Bank to have denied the benefit to the employees. It was also observed that the allowance was still being paid in the 'Tea Board', as pointed out by the Local Zonal Office of the Bank as per Ext.W7. It was accordingly, that Ext. P5 Award was passed holding that the Bank was not justified in withdrawing the benefit given to the employees. 5. The respondent Bank sought to challenge Ext. P5 Award by filing writ petition before this Court. After a threadbare analysis of the facts and figures and after going through the relevant clause in the Bipartite Settlement dated 08.09.1983, the learned single Judge observed that the matter had to be considered giving a 'purposive interpretation' to the relevant clause in the Settlement. According to the learned single Judge, the Special Compensatory Allowance could be paid only as agreed between the Management and the Union. According to the learned single Judge, the Special Compensatory Allowance could be paid only as agreed between the Management and the Union. It was also held that the very object of the said clause was to see that, in the matter of payment of Special Compensatory Allowance, the Bank employees stood equated with the employees of the Central Government and admittedly, the employees of the Central Government were not being paid the compensatory allowance. It was accordingly, that Ext. P5 Award was set aside, declaring that the employees represented by the Union were not eligible for Special Compensatory Allowance. This in turn is under challenge in this Appeal. 6. Heard Mr. Philp J. Vettickattu, the learned counsel representing the employees' Union and Mr. George Thomas Mevada, the learned senior counsel appearing for the respondent Bank at length. 7. The learned counsel appearing for the appellant submits that the challenge is confined to the application of Clause 9 (a) of the Bipartite Settlement dated 08.09.1983, adding that there is no challenge with regard to non-compliance with the provisions of Section 9A of the I.D. Act, as the change has been brought about after issuing a notice, though it was objected by the Union. According to the learned counsel, Clause 9(a) of the Settlement is not at all applicable to the case in hand and that the interpretation given by the Tribuna/Labour Court has to be accepted. When the Statute or provision in the agreement for Settlement is clear, only 'literal interpretation' is possible and there is no room for adopting any purposive interpretation, where the learned single Judge has gone wrong, submits the learned counsel. It was specifically agreed between the Management and the Union, with regard to the circumstances under which the allowance could be stopped and in the instant case, since no Central Government Employees working in the Willington island was ever paid the Special Compensatory Allowance, there was no stoppage of any such allowance in their case, to be taken as a tool or ground to deny such benefit or to stop the benefit to the employees of the Bank. 8. The learned senior counsel appearing for the respondent Bank submits that the crux of the submissions; as evident from the claim put forth before the Tribunal/Labour Court, the interpretation given and now being asserted in this appeal, is rather hyper-technical. 8. The learned senior counsel appearing for the respondent Bank submits that the crux of the submissions; as evident from the claim put forth before the Tribunal/Labour Court, the interpretation given and now being asserted in this appeal, is rather hyper-technical. The learned counsel submits that the employees of the Bank working in Willington island were never entitled to have the Special Compensatory Allowance at any point of time. But, it was only by mistake that the same was being granted and that the mistake cannot be perpetuated. However, since it had obtained the colour and characteristics of a service condition, proper notice under Section 9A of the I.D. Act was issued and it was thereafter, that the stoppage was implemented in the year 1995. The learned counsel further submits that the Bipartite settlement dated 08.09.1993 was entered into, after a series of negotiations between the Indian Banks Association representing 58 Banks and two Unions namely; All India Banks Employees' Association and National Confederation of Bank Employees - representing the workers. Norms were stipulated for payment of such allowance and the conditions under which it could be stopped were also clearly prescribed. As made clear in the relevant clause, it was payable only in respect of employees working in the places mentioned in Column 1 of the Schedule III and also at the rate as prescribed in Column No. 2. Referring to the contents of the Settlement (the relevant potion of which has been produced as Annexure C), the learned counsel submits that 'Willington island' was never a place included in the Schedule, to make any of the employees eligible for obtaining the Special Compensatory Allowance. As such, after the Bipartite Settlement dated 08.09.1983 executed between the Management and the Union, representing the workers, there was absolutely no right for the employees to have claimed the said benefit, which hence was rightly intercepted/stopped after complying with the requirements under Section 9A of the I.D. Act. The said settlement is having application throughout the country and as such, after entering into such Settlement, it is not correct or proper for the appellant Union, who is only a State level body of the Union representing the employees at National level, to contend something contrary to the stand taken by the National level Union. The said settlement is having application throughout the country and as such, after entering into such Settlement, it is not correct or proper for the appellant Union, who is only a State level body of the Union representing the employees at National level, to contend something contrary to the stand taken by the National level Union. It is also pointed out that, undue advantage is sought to be extended, contrary to the Scheme of the Settlement which is not liable to be entertained under any circumstances. 9. Clause 9 of the settlement dated 08.09.1983 as contained in Annexure C is extracted below for convenience of reference : "9. Special Area Allowance : Parties agree that in terms of Clause 19 of the Bipartite Settlement dated 31st October 1979 and Clause 27 of the Bipartite Settlement dated 22nd November 1979, special area allowance will be paid to all full time workmen staff working at places specified in Schedule III hereto at the rates stipulated against each such place, with effect from 1st March 1981, at the places set out in Column 1 of Schedule III, the rate of such special allowance being 10% of the basic pay ('Pay' as defined in the Bipartite Settlement for payment of house rent allowance) subject to minimum and maximum amounts are set out in Column 2 of Schedule III against each such place. The special area allowance will be payable subject to the following conditions: (a) The allowance payable at any place shall be discontinued if such allowance (called by any name whatever) ceases to be payable to the employees of the Central Government. (b) The allowance will continue to be payable at the stipulated rate only until such time as there is no direction to the contrary from the Government and thereafter subject to such direction. (c) Where, however, on the date on which this Settlement comes into force if any workman at the specified places was receiving a special area allowance (called by any name whatever) at a rate higher than that prescribed above, the difference in amount shall be protected and paid as an adjusting allowance. (d) The adjusting allowance referred to above shall cease to be payable to an employee when he ceases to draw special area allowance consequent on his transfer or posting elsewhere or stoppage of payment of the allowance at that place. (d) The adjusting allowance referred to above shall cease to be payable to an employee when he ceases to draw special area allowance consequent on his transfer or posting elsewhere or stoppage of payment of the allowance at that place. (e) Assam allowance (called by any whatever) paid prior to or in terms of Settlement dated 21st April 1980, between the parties shall cease to be payable from 1st March, 1981 at places where special area allowance is payable under the Settlement. Appropriate adjustments will be made while disbursing the arrears of special area allowance in terms of this Settlement. The said Clause makes a reference to Clause 19 of the Bipartite settlement dated 31.10.1979 and Clause 27 of the Bipartite settlement dated 22.11.1979. The relevant portions of the said Settlements have been produced as 'Annexures A and B', along with the statement dated 16.10.2014. Clause 19 of Annexure A Settlement dated 31.10.1979 says that in respect of Special Area Allowances, the parties had agreed to discuss and settle the question of payment of the said allowance at certain special areas. It was not finalized as discernible from Clause 27 of Annexure B as well, which also contains similar clause, that the parties had agreed to discuss and settle the question of payment of allowance at certain special areas. It was thereafter, that the matter was finalized by entering into 'Annexure C settlement' dated 08.09.1983, identifying the areas/places as specified in the Schedule No.III, also mentioning the rates and the conditions for effecting such payment. 10. As per the above Settlement, payment of Special Area Allowance was agreed to be related/connected to the eligibility of the Central Government Employees working in such areas. It was accordingly, that sub clauses (a) and (b) were introduced to Clause 9, which clearly refer to the eligibility to continue to get the allowance, clearly indicating that once the allowance ceased to be payable to the Central Government Employees, it would be discontinued in the case of the employees of the Banks as well. In other words, the Unions representing the employees at the national level agreed to the said proposal and it was accepted that such payment could be stream-lined and connected to the eligibility norms, if payable to the employees of the Central Government. In other words, the Unions representing the employees at the national level agreed to the said proposal and it was accepted that such payment could be stream-lined and connected to the eligibility norms, if payable to the employees of the Central Government. Admittedly, the place 'Willington Island' is never included in the Schedule III of Annexure 3 and as such, there could not have been any claim for allowance from the part of the employees, after the Bipartite Settlement dated 08.09.1983. The payment of Special Area Allowance, as the very name indicates, is with reference to the area concerned; which may be difficult area/remote area as envisaged and clearly identified and enlisted in the Schedule III. Even according to the Tribunal/Labour Court, the purpose has to be examined, i.e, the circumstance for granting the same originally, to ascertain the eligibility, as clearly stated in paragraph 5 of Ext.P5 Award. In other words, the purpose of the settlement (showing the need to have purposive interpretation) was adopted/accepted by the Tribunal, which alone has been done by the learned single Judge as well. 11. Apart from the fact that Willington Island was never a place enlisted in Schedule III of the Settlement dated 08.09.1983, it also remains a fact that the position which was prevailing earlier (if at all it was to be treated as a 'difficult area' pursuant to the Settlement of 31.03.1967), was tremendously improved, which cannot be lost sight of. It is a matter which can be taken judicial notice of, that the Willington Island is situated hardly few kms. away from the 'Marine Drive' and the seat of the High Court and the island is very much visible by the naked eyes. It is part of the Corporation of Kochi and there is absolutely no problem with regard to the conveyance. No private property is permitted in the island and there are several Central Government Offices and such other institutions. It also remains a fact that no Special Area Allowance is being paid to any of the Central Government Employees, particularly the Customs Department, as discernible from Ext. P4. There is no case for the appellant Union that the Central Government Employees are getting such allowances in the Willington Island, though there is a contention that employees of the 'Tea Board' are getting the said benefit. P4. There is no case for the appellant Union that the Central Government Employees are getting such allowances in the Willington Island, though there is a contention that employees of the 'Tea Board' are getting the said benefit. Tea Board is constituted under a special Statute and the employees of the Tea Board are not Central Government Employees. In so far as there is clear stipulation in Clause 9 of the Settlement dated 08.09.1983, that the payment of allowance is closely interlinked with the eligibility of the Central Government Employee to get such allowance, further stipulating that it will get stopped when such payment is discontinued to Central Government Employee, the employees of the respondent Bank cannot aspire to get such benefit, if it is not being enjoyed by the Central Government employees. This being the position, there is nothing wrong in having interpreted the scope of the provision (Clause 9 of the Settlement dated 08.09.1983) as done by the learned single Judge. The idea and understanding of the appellant to the contrary is thoroughly wrong and misconceived. 12. Yet another aspect to be noted is that, in paragraph 2 of the claim statement, the appellant Union has conceded that the payment of Special Compensatory Allowance was effected to the employees of the Bank working in Willington Island on 26.04.1968 (with retrospective effect from 01.08.1966) on the basis of 'paragraph 5.8' of the agreement dated 31.03.1967 between the Bank and the All India State Bank of India Staff Federation. Relevant portion of the said agreement dated 31.03.1967 has been produced by the Bank along with a statement dated 5th of August, 2015 as 'Annexure E'. Paragraph 5.8 of the said agreement reads as follows : "(vi) SPECIAL COMPENSATORY ALLOWANCE 5.8 Employees working at Vishakhapattanam will be paid special compensatory allowance at the following rates :- Clerical Staff and Cash Rs.11/- per mensem Department Staff Subordinate Staff Rs.5/- per mensem" From the above, it is very much evident that, as per the agreement dated 31.03.1967, payment of the benefit under 'paragraph 5.8' (as pointed out by the Union in paragraph 2 of Ext. P1 claim statement could only be in respect of the employees working in Vishakhpattanam and nowhere else. Coming to the Settlement dated 08.09.1983, Schedule III does not contain any place in Kerala to be treated as a 'special area' for giving Special Area Allowance. P1 claim statement could only be in respect of the employees working in Vishakhpattanam and nowhere else. Coming to the Settlement dated 08.09.1983, Schedule III does not contain any place in Kerala to be treated as a 'special area' for giving Special Area Allowance. The position becomes more clear from Annexure D Office Memorandum dated 29.08.2008 issued by the Ministry of Finance, Government of India, Department of Expenditure (pursuant to the recommendation of the Sixth Central Pay Commission - Revision of rates) that no place in Kerala has been notified as a place to be treated as an area for which Special Compensatory Allowance is payable. The nearest place as shown in the Annexure to the said office memorandum is the entire Union Territory of Lakshdweep. 13. This Court finds that the interpretation given by the learned single Judge is in tune with the dictum laid down by the Supreme Court in Tirath Singh Vs. Bachittar Singh [ AIR 1955 SC 830 ]. The Settlement dated 08.09.1983 clearly bars the payment of any Special Compensatory Allowance to the employees represented by the Union working in the Willington Island branch of the State Bank of India, in view of the admitted position that no Central Government Employee working in the Willington Island is being paid such allowance. As noted already, even in the 31.03.1967 Settlement, Willington Island was never a place for payment of Special Compensatory Allowance and by virtue of 'Paragraph 5.8' (relied on by the Union), it could have been paid only in respect of the employees working in Visakhapattanam. As such payment of the allowance with effect from 01.08.1966 [till the same was stopped] could one be by way of mistake. Mistake is always a mistake, which is liable to be corrected at the earliest instance/opportunity. But since it had become a part of conditions of service, the same was discontinued by issuing proper notice under Section 9A of the Industrial Dispute Act and the stoppage was implemented with effect from 15.01.1995. Since there is no challenge with regard to the course pursued by the Bank in relation to Section 9A of the I. D. Act, stoppage of such allowance is perfectly in tune with the relevant provisions of law. This Court finds that the appeal is devoid of any merit and none of the grounds raised in support the same could be held as tenable. This Court finds that the appeal is devoid of any merit and none of the grounds raised in support the same could be held as tenable. Appeal stands dismissed accordingly.