Rajasthan High Court - Jaipur
Bank Of Rajasthan Retired Staff Society vs Bank Of Rajasthan Ltd. on 16 July, 2004
Equivalent citations: RLW2005(1)RAJ133, 2004(4)WLC331
JUDGMENT Shiv Kumar Sharma, J.
1. Prayer of the petitioner in the instant writ petition is as under:-
(i) to direct the respondents to pay interest at the rate of 18% per annum to its retired employees who opted for pension and its commutation and who have been made delayed payment of these benefits as stated in the writ petition.
2. Contextual facts depict that the members of the petitioner Society are returned employees of the respondent Bank. They got registered the society for the purpose of cultural and economic welfare of its members. The settlement was arrived at between the Management of 58 Banks and their unions for introduction of pension scheme on October 29, 1993 and the pension scheme was effected from November 1, 1993. The Bank of Rajasthan Limited (Employees) Pension Regulation, 1993 came into force from November 1, 1993. Lateron the Bank of Rajasthan Ltd. (Employees) Pension Rules, 1996 (for short '1996 Rules') came into force with retrospective effect from September 29, 1995. According to Rule 3 of 1996 Rules most of the employees opted for pension. Rule 41 of 1996 Rule provides for commutation of pension. Rule 52 of 1996 Rules provides for the date from which the pension becomes payable.
The members of the petitioner society opted for pension and they retired upto December 31, 1996. The respondent made payment of arrears of pension to such retired employees after August 1, 1999. Thus the payment of pension was delayed for a period of ranging from 6 months to 5 years.
The respondent arbitrarily started deduction of 1/3 basic pension towards commutation from monthly pension w.e.f. January 1, 1997, whereas the commuted value was paid only after August 1, 1999. The respondent also deducted interest 6% p.a. for the part value of CPF, but no interest has been paid to employees on delayed payment. The respondent vide letter dated September 14,2000 declined the request of payment of interest.
3. The respondent filed reply to the writ petition and submitted that the petitioner society not been empowered to agitate any question in vague and general manner. He has no authority to act in any case/suit or writ petition as a representative character. The respondent raised objection regarding maintainability of the writ petition against the respondent Bank as the Bank of Rajasthan is not a 'State' within the meaning of Article 12 of the Constitution. The Bank of Rajasthan is a public limited Banking Company and initially established under the Mewar Companies Act, 1942. The Bank of Rajasthan is governed by the provisions of Companies Act. The management and affairs of the Bank are not controlled by any agency or the Institution of the State. The entire share capital does not belong to the State and it has no monopoly status. The functions are also not closely related with the Government functions, as it is not a department of the Government. The pensioners who opted for pension under the Bank of Rajasthan Ltd. (Employees) Pension Rules, 1996 have consented to enjoy the rights and adhere to Rules without any objection. In view of the provisions of Rule 89 of Income Tax Rules, 1962, the Government of India discriminated in exempting the private sector Banks, therefore, the writ petition was filed, and as such the pension scheme could not be implemented in regular from and the arrears could not be paid due to administrative and practical constraints and delay caused. However, the Pension Scheme has been implemented and retired employees enjoyed the benefits without any objection by accepting commuted amount as also are regularly drawing pension. The delay is caused on part of the Government and beyond the control of Bank.
4. The petitioner has filed rejoinder and submitted that the Bank is under obligation to discharge its responsibilities arising under statutory provisions as such the writ petition is maintainable. As the members of the petitioner Society are affected, therefore they have right to file the writ petition.
5. I have heard the rival submissions and scanned the material on record as well as the case law cited in support of contention.
6. At the outset I proceed to consider the preliminary objection regarding maintainability of the writ petition against the respondent Bank. It is canvassed that the Bank of Rajasthan is a public limited Banking Company. It was initially established under the Mewar Companies Act, 1942. The Bank of Rajasthan is governed by the provisions of Companies Act and its management and affairs are not controlled by any agency or the Institution of the State. The entire share capital does not belong to the State and it has no monopoly status. The functions of the Bank are not closely related with the Government functions, as it is not a department of the Government. On the other hand it is urged on behalf of the petitioner that the Bank is under obligation to discharge its responsibilities arising under statutory provisions, therefore, the writ petition is maintainable.
7. In Andi Mukta Sadguru Shree Muktajee Vandas Swami Suvarna Jayanti Mahotsav Smarak Trust and Ors. v. V.R. Rudani and Ors., (1989 2 SCC 91), their Lordships of Supreme Court held that the college in question which was managed by a trust registered under the Bombay Trusts Act was amenable to the writ jurisdiction and a direction could be issued to the institutions to make the payment of arrears of salary and other benefits to the teacher. In para 17 of the judgment it was held that:-
"There, however, the prerogative writ of mandamus is confined only to public authorities to compel performance of public duty. The 'public authority' for them mean ever body which is created by statute and whose, powers and duties are defined by statute. So government departments, local authorities, police authorities and statutory undertakings and corporations are all 'public authorities. But there is not such limitation for our High Court to issue the writ in the nature of mandamus.' Article 226 confers wide powers on the High Court to issue writs in the nature of prerogative writs. This is a striking departure from the English Law. Under Article 226, writs can be issued to "any person or authority". It cam be issued "for the enforcement of any of the fundamental rights and for any other purpose."
8. In Unni Krishnan J.P. and Ors. v. State of Andhra Pradesh and Ors., (1993(1)SCC 945), a Constitutional Bench indicated in para 79 that education institutions discharge public duties irrespective of the fact that they receive aid or not. The absence of aid does not detract from the public nature of the duty. Even though a body or institution may be a private body but if the duty that it discharges is that of a public nature, a writ would lie.
9. A Constitutional bench of Hon'ble Supreme Court in All India Bank Employees' Association v. National Industrial Tribunal and Ors., (1962 (3) SCR 265), indicated as under:-
"... If it was not the Reserve Bank of India, the only authority that could be entrusted with the function would be the Finance Ministry of the Government of India and that department would necessarily be guided by th Reserve Bank having regard to the intimate knowledge which the Reserve Bank has of the banking structure of the country as a whole and of the affairs of each bank in particular...."
10. In Air India Statutory Corporation and Ors. v. United Labour Union and Ors. (1997(9) SCC 377), a three Judge Bench of Hon'ble Supreme Court propounded that the industry carried on by Air India under authority of central government would involve public law element even though its activity may be commercial in nature, it was held that the Air India was being run by the Airport Authority of India of the Central Government and there was element of deep and pervasive governmental control. Initially it was a statutory authority under the International Airports Authority of India Act, 1971. Later it was amalgamated with National Airports Authority and thereafter it is constituted as a company under the companies Act. In that context, it was held that if the company is run wholly or partially by the share capital floated from public exchequer, it gives indication of its control by the appropriate government.
11. Mr. R.K. Kala, learned counsel for the respondent Bank placed reliance on Federal Bank Ltd. v. Sagar Thomas and Ors. (2003(6) SLR 396), wherein the bench of Hon'ble two judges of the Hon'ble Supreme Court in para 18 indicated as under:-
"From the decisions referred to above, the position that emerges is that a writ petition under Article 226 of the Constitution of India may be maintainable against (i) the State (Govt.); (ii) Authority; (iii) a statutory body; (iv) an instrumentality or agency of the State; (v) a company which is Financed and owned by the State; (vi) a private body run substantially on State funding; (vii) a private body discharging public duty or positive obligation of public nature (viii) a person or a body under liability to discharge any function under any Statute, to compel it to perform such a statutory function."
12. In para 33 of the said judgment their Lordships of Supreme Court observed that private body or a person may be amenable to writ jurisdiction only where it may become necessary to compel such body or association to enforce any statutory obligations or such obligations of public nature casting positive obligation upon it.
13. A look at the provisions contained in Reserve Bank of India Act, 1934, the Banking Regulation Act, 1941 and the Industries (Development and Regulation) Act, 1951 demonstrates that there is deep and all pervasive statutory control and the control of the Central Government over the Scheduled Banks. Scheduled Banks discharge functions of public nature and owe the statutory responsibilities. There is na element of public law, involved in the activities of the Bank. Section 22 of the Banking Regulation Act provides for licensing of banking companies. No company can carry on banking business in India unless it holds a license issued by the Reserve Bank subject to such conditions as may be imposed. Before issuing any license the Reserve Bank may satisfy itself about the conditions as laid down under Sub-section (3) of Section 22 as to whether the company fulfills those conditions or not. Section 2(e) of Reserve Bank of India Act, 1934 defines Scheduled Bank, which includes a bank incorporated in the second schedule. The respondent Bank comes within the definition of Scheduled Bank. In my opinion the respondent Bank is under obligation to discharge is responsibilities arising under statutory provisions and it is amenable to writ jurisdiction. The respondent bank is not merely a private company carrying on banking business but it acts as scheduled bank to enforce its statutory obligations of public nature casting positive obligation upon it. In Federal Bank Ltd. v. Sagar Thomas and Ors. (supra), the Federal Bank was a private company carrying of banking business as scheduled bank and in such situation their Lordships of Supreme Court held that Federal Bank cannot be termed as an institution or company carrying out any statutory or public duty. There Judge Bench of Hon'ble Supreme Court in Bank of India v. O.P. Swarnakar (2003(2) SCC 721), indicated in para 48 that all the nationalized Banks are 'States' with in the meaning of Article 12.
14. Coming to other aspect of the matter, I find that members of petitioner society are retired employees of the respondent bank and the settlement was arrived at between the management of 58 banks and their unions for introduction of pension scheme on October 29,1993, which came into force from November 1,1993. The Bank of Rajasthan Limited (Employees) Pension Regulation, 1993 came into force with retrospective effect from September 29,1995. As per Rule 3 of 1996 Rules the members of the petitioner society opted for pension and they retired upto December 31, 1996. The respondent bank made payment of arrears of pension to members of the petitioner society after August 1,1999 and admittedly the payment of pension was delayed. Since the grievance of the members of the petitioner society is common, in my opinion the joint writ petition is maintainable. I find myself unable to accept the contention that the delay is caused on the part of the Government and it was beyond the control of respondent bank.
15. For these reasons, I allow the writ petition and direct the respondent bank to pay the interest at the rate of 18% per annum to members of the petitioner society on the delayed payment of pension. The respondent bank shall ensure the compliance of this order within three months from the date of receipt of copy of this order. There shall be no order as to costs.