Kerala High Court
Radha.R vs The State Of Kerala on 31 July, 2014
Author: P.V.Asha
Bench: P.V.Asha
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE SMT. JUSTICE P.V.ASHA
FRIDAY, THE 14TH DAYOF JULY 2017/23RD ASHADHA, 1939
WP(C).No. 3267 of 2017 (G)
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PETITIONER(S) :
--------------------------
1. RADHA.R.,
DEPUTY MANAGER,
KERALA STATE FINANCIAL ENTERPRISES (K.S.F.E) LTD.,
NEDUMANGAD BRANCH, THIRUVANANTHAPURAM DISTRICT.
2. SIVARAMAN.M.C.,
SENIOR MANAGER, KERALA STATE FINANCIAL ENTERPRISES
(K.S.F.E), KUNNAMANGALAM BRANCH, KOZHIKODE DISTRICT.
3. PADMINI.P,
DEPUTY MANAGER, KERALA STATE FINANCIAL ENTERPRISES
(K.S.F.E), MEPPAYYUR BRANCH, KOZHIKODE DISTRICT.
4. SREEDHARAN M.T.,
ASSISTANT MANAGER,
KERALA STATE FINANCIAL ENTERPRISES (K.S.F.E),
KALLACHY BRANCH, KOZHIKODE DISTRICT.
5. KAMALUDHEEN.A.,
SENIOR MANAGER, KERALA STATE FINANCIAL ENTERPRISES
(K.S.F.E) LTD., CHANDRANAGAR BRANCH, PALAKKAD DISTRICT.
6. RAJAGOPAL.K,
MANAGER GRADE III,
KERALA STATE FINANCIAL ENTERPRISES (K.S.F.E),
(LOAN UNIT), KOTTAYAM.
7. ULLASAN NAMBIAR K.T.N.,
SENIOR MANAGER, OFFICE OF THE SPECIAL DEPUTY TAHSILDAR
(RR), KERALA STATE FINANCIAL ENTERPRISES LTD., (K.S.F.E)
KANNUR 670 002.
8. SUDHAKARAN.P.,SENIOR MANAGER,
KERALA STATE FINANCIAL ENTERPRISES (K.S.F.E),
WEST HILL BRANCH, KOZHIKODE DISTRICT 05.
9. KAMALA DEVI.P., DEPUTY MANAGER,
KERALA STATE FINANCIAL ENTERPRISES (K.S.F.E),
KALOOR BRANCH, ERNAKULAM DISTRICT.
..2/-
..2..
WP(C).No. 3267 of 2017 (G)
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10. MURALEEDHARAN K.,
DEPUTY MANAGER,
KERALA STATE FINANCIAL ENTERPRISES (K.S.F.E),
KULATHUPUZHA BRANCH, KOLLAM DISTRICT.
11. RAMALATH P.A.,
CHIEF MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD. (K.S.F.E),
REGIONAL OFFICE, THRISSUR.
12. MEENA.S.,
DEPUTY MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD. (K.S.F.E),
REGIONAL OFFICE, THRISSUR,
13. T.V.SOBHANAN
ASSISTANT MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD. (K.S.F.E) ,
KODAKRA BRANCH, THRISSUR DISTRICT.
14. UNNIKRISHNAN,
MANAGER GRADE IV,
KERALA STATE FINANCIAL ENTERPRISES LTD. (K.S.F.E) ,
THRISSUR MAIN (1) BRANCH, THRISSUR DISTRICT.
15. K.M. AJAYAN,
ASSISTANT MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD. (K.S.F.E) ,
AYYANTHOLE BRANCH, THRISSUR DISTRICT.
16. NARAYANAN K.,
CHIEF MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD. (K.S.F.E) ,
REGIONAL OFFICE, KOZHIKODE, KOZHIKODE DISTRICT
17. KAMALA K.P.,
CHIEF MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD. (K.S.F.E),
THAMARASSERY BRANCH, KOZHIKODE DISTRICT.
18. MOHANAN M.K.,
MANAGER GRADE IV,
KERALA STATE FINANCIAL ENTERPRISES LTD. (K.S.F.E),
REGIONAL OFFICE, KALLAI ROAD, KOZHIKODE DISTRICT.
19. SOYA PRAMEELA, DEPUTY MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD. (K.S.F.E),
MAVOOR ROAD BRANCH, KOZHIKODE, KOZHIKODE DISTRICT.
..3/-
..3..
WP(C).No. 3267 of 2017 (G)
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20. GEORGE P.AUGUSTINE,
ASSISTANT MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD. (K.S.F.E),
CHEMBERI BRANCH, MUKKUZHI COMPLEX,
HOSPITAL ROAD, CHEMBERI P.O,KANNUR DISTRICT.
21. RADHAKRISHNAN.K.,
DEPUTY MANAGER, OFFICE OF THE SPECIAL DEPUTY
TAHSILDAR (R.R.), KERALA STATE FINANCIAL ENTERPRISES
LTD. (K.S.F.E), KANNUR DISTRICT.
22. JAYARAJAN.C,
OFFICE ATTENDANT,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
THALASSERY MAIN BRANCH, THALASSERY,KANNUR DISTRICT.
23. VIMALA.J.,
JUNIOR ASSISTANT,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
MAVOOR ROAD BRANCH, KOZHIKODE,
KOZHIKODE DISTRICT.
24. RAJASEKHARAN PILLAI.K.,
ASSISTANT MANAGER/ASSISTANT INSPECTING OFFICER,
INTERNAL AUDIT DEPARTMENT (IAD),
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
KOTTAYAM 01.
25. SIVANKUTTY.P,
SPECIAL GRADE ASSISTANT,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
KOLLAM EVENING BRANCH, KOLLAM DISTRICT.
26. ANTONY.K.V
MANAGER/INSPECTING OFFICER,
INTERNAL AUDIT DEPARTMENT (IAD),
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
ERNAKULAM 02.
27. MURALEEDHARAN.P,
SENIOR MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
ANCHAL MAIN BRANCH,
ANCHAL, KOLLAM DISTRICT.
28. R. VALSALA KUMARI,
SPECIAL GRADE ASSISTANT,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
CHAVARA BRANCH, KOLLAM DISTRICT.
..4/-
..4..
WP(C).No. 3267 of 2017 (G)
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29. ASHA P.T.,
ASSISTANT MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
ALAPPUZHA II BRANCH, ALAPPUZHA DISTRICT.
30. K.P.ALIAS,
CHIEF MANAGER, KERALA STATE FINANCIAL ENTERPRISES LTD.
(K.S.F.E), KALPETTABRANCH, TRIDENT ARCADE,
KALPETTA P.O, WAYANAD DISTRICT 673 121.
31. VALSALA DEVI P.B.,
SENIOR ASSISTANT,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
MEPADY BRANCH, MEPADY P.O,
WAYANAD DISTRICT 673 577.
32. RETNAKARAN K.,
ASSISTANT MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
NADAKKAVU BRANCH, KOZHIKODE DISTRICT.
33. VIMALA K.K.,
DEPUTY MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
HEAD OFFICE, THRISSUR 20.
34. VALSALA M.,
OFFICE ATTENDANT (SPECIAL GRADE),
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
ARADHANA WEDDING, NEAR NSS HSS PRAKKULAM,
KANJAVELY P.O,KOLLAM, PIN 691 602.
35. S.A. ABDUL NIZAR,
OFFICE ATTENDANT,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
HEAD OFFICE, BHADRATHA, MUSEUM ROAD,
THRISSUR 680 020.
36. PREMAN P.P.,
CHIEF MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
REGIONAL OFFICE, KANNUR.
37. PRAKASH.S,
SENIOR MANAGER/MANAGER GR.II,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
KUNNICODE BRANCH, KOLLAM DISTRICT- 691 508.
..5/-
..5..
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38. RAGINI.B.,
ASSISTANT MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
PUNNAPRA BRANCH, PARATHARA BUILDINGS,
MARKET JUNCTION, ALAPPUZHA DISTRICT.
39. MATHAI.A,
MANAGER GR IV,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
KARIMANNOOR BRANCH, KARIMANNOOR P.O,
IDUKKI DISTRICT
40. GIRIJA DEVI.C.K.,
DEPUTY MANAGER,
KERALA STATE FINANCIAL ENTERPRISES LTD.(K.S.F.E),
KONGOD, PALAKKAD DISTRICT
BY ADV. SRI.N.RAGHURAJ
RESPONDENT(S) :
-----------------------------
1. THE STATE OF KERALA,
REPRESENTED BY PRINCIPAL SECRETARY TO GOVERNMENT,
TAXES (H) DEPARTMENT, GOVERNMENT SECRETARIAT,
THIRUVANANTHAPURAM- 695 001.
2. THE PRINCIPAL SECRETARYTO GOVERNMENT,
FINANCE DEPARTMENT, GOVERNMENT SECRETARIAT,
THIRUVANANTHAPURAM 695 001.
3. KERALA STATE FINANCIAL ENTERPRISES LTD.,
REPRESENTED BY ITS MANAGING DIRECTOR,
HEAD OFFICE, BHADRATHA, MUSEUM ROAD,
THRISSUR 680 020.
4. THE MANAGING DIRECTOR,
KERALA STATE FINANCIAL ENTERPRISES LTD.,
HEAD OFFICE, BHADRATHA, MUSEUM ROAD, THRISSUR 680 020.
R1 & R2 BY SRI.K.K.RAVINDRANATH, ADDL.ADVOCATE GENERAL
BY GOVERNMENT PLEADER SRI. MUHAMMED FAZIL.M.P
R3 & R4 BY ADV. SRI.M.GOPIKRISHNAN NAMBIAR
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION
ON 19-06-2017, ALONG WITH W.P(C).NO. 32100 OF 2015 AND CONNECTED
CASES, THE COURT ON 14-07-2017 DELIVERED THE FOLLOWING:
Msd.
WP(C).No. 3267 of 2017 (G)
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APPENDIX
PETITIONER(S)' EXHIBITS :
EXHIBIT P1 TRUE PHOTOCOPY OF THE MINUTES OF THE 460TH MEETING OF
THE BOARD OF DIRECTORS OF THE 3RD RESPONDENT HELD
ON 25-06-2014.
EXHIBIT P2 TRUE PHOTOCOPY OF THE INTERIM ORDER DATED 31-07-2014 IN
I.A NO. 9515/2014 IN WP(C) NO 13748/2014.
EXHIBIT P3 TRUE COPY OF THE COMMUNICATION BEARING
NO. 32318/PUC2/14/FIN. DATED 22-07-2014 ISSUED BY
THE 2ND RESPONDENT.
EXHIBIT P4 TRUE PHOTOCOPY OF THE COMMUNICATION BEARING
NO. 20688/H2/2014/TD DATED 25-07-2014 ISSUED BY THE TAXES
SECRETARY.
EXHIBIT P5 TRUE PHOTOCOPY OF THE COUNTER AFFIDAVIT FILED BY
THE 1ST RESPONDENT IN W.P(C) NO. 13748/2014.
EXHIBIT P6 TRUE PHOTOCOPY OF THE JUDGMENT DATED 11-02-2015 IN
W.P(C) NO. 13748/2014.
EXHIBIT P7 TRUE PHOTOCOPY OF G.O(RT) NO. 340/2015/TD DATED 20-05-2015
EXHIBIT P8 TRUE PHOTOCOPY OF THE INTERIM ORDER DATED 03-06-2015 IN
WP(C) NO. 16338/2015.
EXHIBIT P9 TRUE PHOTOCOPY OF THE JUDGMENT DATED 28-09-2015 IN
WP(C) NO. 16338/2015.
EXHIBIT P10 TRUE PHOTOCOPY OF THE ORDER BEARING
NO G.O(MS) NO. 192/2015/TD DATED 17-10-2015.
EXHIBIT P10(A) TRUE PHOTOCOPY OF THE INTERIM ORDER IN
W.P(C) NO. 32947/2016 DATED 14-10-2016.
EXHIBIT P11 TRUE PHOTOCOPY OF THE INTERIM ORDER DATED 27-07-2016 IN
W.P(C).NO. 32110/2015.
EXHIBIT P12 TRUE PHOTOCOPY OF THE ORDER G.O(RT.) NO.817/2016/TD
DATED 21-10-2016.
EXHIBIT P13 TRUE PHOTOCOPY OF THE ANNEXURE IX OF THE REVIEW.
EXHIBIT P14 TRUE PHOTOCOPY OF THE ANNEXURE XIV OF THE REVIEW.
EXHIBIT P15 TRUE PHOTOCOPY OF THE ANNEXURE XIII OF THE REVIEW IS
THE LIST OF STATE LEVEL PUBLIC ENTERPRISES WITH
ACCUMULATED LOSS
WP(C).No. 3267 of 2017 (G)
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EXHIBIT P16 TRUE PHOTOCOPY OF THE ORDER BEARING
GO(MS) NO. 108/2014/ID DATED 31-07-2014.
EXHIBIT P17 TRUE PHOTOCOPY OF THE ORDER BEARING
G.O(MS) NO. 745/2014/H.EDN. DATED 29-08-2014.
EXHIBIT P18 TRUE PHOTOCOPY OF GO(MS)NO. 43/2014/2014/P & ARD
DATED 27-12-2014.
EXHIBIT P19 TRUE PHOTOCOPY OF THE CONGRATULATORY LETTER ISSUED
BY THE 4TH RESPONDENT TO ALL THE UNITS OF KSFE
ON 01.12.2015.
EXHIBIT P20 TRUE PHOTOCOPY OF THE OFFICIAL STATEMENT OF
BHAGYAVARSHA CHITTY AS ON 30.11.2015 PUBLISHED BY
THE 3RD RESPONDENT.
EXHIBIT P21 TRUE PHOTOCOPY OF THE NOTIFICATION INVITING
APPLICATIONS TO THE POST OF JUNIOR ASST. ETC IN
THE 3RD RESPONDENT AND OTHER SIMILARLY PLACED
GOVERNMENT COMPANIES/CORPORATIONS.
EXHIBIT P22 TRUE PHOTOCOPY OF THE OFFICE ORDER BEARING
REF. NO. 4307/ADMN DATED 02.06.2017.
RESPONDENT(S)' EXHIBITS :
//TRUE COPY//
P.S.TOJUDGE.
Msd.
P.V.ASHA, J.
--------------------------
W.P(C) Nos.3267 of 2017-G, 32100/2015-J,
32107/2015-K, 32110/2015-K, 32111/2015-L, 32115/2015-L,
32269/2015-G, 32445/2015-E, 32518/2015-L, 32595/2015-Y,
32629/2015-C, 32873/2015-H, 33836/2015-D, 34135/2016-N, 34229/2015-C,
34339/2015-N, 34648/2015-E, 34731/2015-N, 34732/2015-N, 35517/2015-L,
37791/2015-Y, 38380/2015-V, 6905/2016-K, 7448/2016-E, 11364/2016-U,
15918/2016-L, 16933/2016-N, 17174/2016-V, 21843/2016-E, 24925/2016-M,
24994/2016-Y, 25305/2016-K, 28190/2016-W, 32947/2016-P, 34651/2016-F,
37746/2016-P, 39104/2016, 40545/2016-P, 40826/2016-C,
41533/2016-N, 2793/2017-Y, 3373/2017-V,5767/2017-U,
6355/2017-T, 7823/2017-C, 8757/2017-T, 9008/2017-A,
9685/2017-I, 10197/2017-Y, 10625/2017-C, 10863/2017-G,
12987/2017-W, 13019/2017-B, 13659/2017-F, 14320/2017-L,
15687/2017-I, 18643/2017-E.
-------------------------------------------
Dated this the 14th day of July, 2017
JUDGMENT
All these writ petitions relate to the enhancement of retirement age of the employees in the Kerala State Financial Enterprises Ltd. (`KSFE' for short) and are therefore disposed of by this common judgment. Parties and documents referred to in this judgment are as described in W.P.(C) No.3267 of 2017, unless specified otherwise.
2. The employees of the KSFE are in the 4th round of litigation for enhancement of retirement age. At the time when these writ petitions were filed, the Board of Directors of KSFE had already taken a decision to enhance the retirement age, but their proposal was not approved by the W.P(c).No.3267/2017 & conn.cases 2 Government. Subsequent to the filing of these writ petitions the Board of Directors cancelled their earlier decision to enhance the retirement age.
3. The KSFE is a company fully owned by the Government, incorporated under the Companies Act, 1956 and it is a miscellaneous non banking financial institution. The service conditions of the employees of the KSFE are governed by "Standing Orders applicable to the employees of the Kerala State Financial Enterprises Ltd." which is a certified standing order in terms of Clause 17 of the Industrial Employment (Standing Orders Act, 1946). As per clause 17 of the standing orders, the age of retirement of the employees under the KSFE is 58 years. The service of the employees in KSFE is not pensionable except under Employees P.F Scheme. Seeing that the retirement age of the employees was enhanced in various public sector undertakings as well as the Government institutions, the employees of the KSFE had submitted a representation on 1.8.2013 requesting for enhancement of retirement age to 60 years. Thereafter, writ petition -W.P (C).No.27353 of 2013 was filed by some of the employees for the same relief. By judgment dated 20.02.2014, the writ petition -W.P(C).No.27353 of 2013 was disposed of along with other connected cases directing the respondents to take a final decision on the question of retirement age. W.P(c).No.3267/2017 & conn.cases 3
4. In the 460th meeting of the Board of Directors held on 25.06.2014, item no.18 in the agenda was "to consider the enhancement of retirement age of the Company employees from 58 years to 60 years and implementation of VRS to the Company Employees. The minutes with respect to decision on item no.16, reads:
" The Board while discussion noted that the Government of Kerala has hiked the retirement age of State Government Employees from 55 to 56 and many State and Central PSUs have also enhanced the retirement age of their employees. In the case of scheduled banks, the retirement age is already sixty. Seventeen states of India and the Central Government have already adopted sixty as the retirement age. In present scenario of Chit Business under Chit Funds Act, 1982, which is more stringent in enforcement of its various sections, more and more private operators are on the look out for experienced officers who have worked with organized corporates in the field like K.S.F.E. If they reach Branch Managers retiring at the age of 58, who are still in the pink of their health and mature in respect of experience, they will get a competitive edge over K.S.F.E, To avoid this precarious and detrimental situation, it will be advisable to rise the retirement age to sixty as in most of the other State Governments, Central Government PSUs, Central Government and some of the State PSUs. It is also a fact that the Employees in Government who are now recruited through KPSC (from the financial year 2013-14 onwards) have their retirement age fixed as sixty (vide the budget for the financial year 2013-14 presented by the Honourable Finance Minister). This reform has coincided with the abolition of pension for the newly recruited State Government employees and introduction of the "Contributory Pension". K.S.F.E Employees have not been granted the pension facility (as was prevalent in State Government till the financial Year, 2012-13) and this renders more justification for raising of retirement age to 60, as in the case of State Government employees who are recruited for the financial year 2013-14 onwards. In view of the above situation, Unions/Associations of the Company has raised demand for increasing the retirement age in the Company to 60 years. Some people had also approached the Court for enhancing the retirement age and Court has directed to consider the same and give reply. Areply has to be furnished by the State Government without further delay. However, Sri. Papanamcode Sreeni, Director and Sri. Sankaran Master, Director opposed the proposal and stated that it is against the interest of the general youth and also against the interest of the Company. However, after detailed discussion the following resolution was carried with the dissent of Sri. Papanamcode Sreeni and Sri. Sankaran Master, Directors.
Resolution No.6590 "Resolved to recommend to the Government of Kerala the enhancement of retirement age of the KSFE Employees from 58 years to 60 years."W.P(c).No.3267/2017 & conn.cases 4
5. On 25.06.2014, the Board of Directors passed resolution No.6590 to recommend to Government of Kerala the enhancement of retirement age of KSFE employees from 58 to 60 years.
6. Immediately after the resolution was passed, certain employees filed W.P).No.13748 of 2014 seeking enhancement of retirement age. By Ext.P2 order dated 31.7.2014 in I.A.No.9515 of 2014 in W.P).No.13748 of 2014, this Court passed an interim order directing the respondents to allow the petitioners therein to continue in service pending disposal of the writ petition despite their attaining the age of 58 years. By Ext.P3 letter dated 22.7.2014, the Additional Chief Secretary to Government, Finance Department informed the 3rd respondent-the Managing Director of KSFE, the following:
"The enhancement of retirement age of the employees of Public Sector Undertakings is to be decided by Government as a matter of policy. Finance Department had taken a stand not to enhance the retirement age of employees of Public Sector Undertakings at this point of time and the decision has been intimated to the Secretary, Taxes Department through a DO letter."
7. Thereupon the Secretary to Government, Taxes Department issued Ext.P4 letter dated 25.07.2014 to the 3rd respondent informing that the Department of Taxes, after considering all the relevant aspects, had taken a final decision that the recommendation of the Board of Directors of W.P(c).No.3267/2017 & conn.cases 5 KSFE for enhancement of retirement age need not be considered for the time being.
8. The decision of the Government was challenged in a batch of writ petitions, alleging that there is no liability cast upon the Government in case retirement age is enhanced and this is evident from the annual review of State Level Public Enterprises. The petitioners claimed that the KSFE is ranked as No.2 in the State Level Public Enterprises having secured a profit to the tune of Rs.11,512 lakhs during 2012-2013, as evident from the 33rd annual review of State Level Public Enterprises in the year 2012-2013. Producing Exts.P8 and P9 reports of review in W.P).No.3373 of 2017, the petitioners claimed that the KSFE is a profit making company and in the year 2013, its profit was to the tune of Rs.11,512/- lakhs. According to the petitioners, the business growth of the company for the last more than 5 years was steadily upwards. The petitioners point out that there are at least 17 public sector undertakings in which the retirement age fixed is 60 years. It is further stated that out of the 17 companies, some of them are running at loss. It is also pointed out that as per Ext.P11 decision dated 31.7.2014, the Government had allowed the request of K-BIP for enhancement of retirement age.
W.P(c).No.3267/2017 & conn.cases 6
9. The employees challenged the decision of the Government in a batch of writ petitions. Thereafter the second round of litigation concluded in the common judgment Ext.P6 dated 11.2.2015 in W.P).No.13748 of 2014 and connected cases, setting aside the orders Exts.P3 and P4 dated 22.07.2014 and 25.7.2014 respectively. The Writ Petitions were disposed of directing the Government to take appropriate decision based on Ext.P1 resolution and allowing the petitioners to continue till a decision was taken. It was further directed that in the event of a decision adverse to them, they shall be retained for a further period of 2 weeks to enable them to seek appropriate remedies. It was ordered that the payment of salary to such employees would depend upon the outcome of the decision of the Government.
10. The learned Single Judge observed the following in paragraph 6,7 and 8 of the judgment :
"6. xxxxx The Board is required to have prior approval of the Government to amend the bye-laws for enhancing the retirement age of the employees. The reference in these articles of Association of KSFE is to have the prior approval of the Governor. Under Article 166 of the Constitution of India, all executive action of the Government of a state shall be expressed to be taken in the name of Governor. The question is whether there is a pre-existing policy of government to enhance the retirement age.
7. The function of the Governor, in terms of the Articles of Association, is in relation to the Company. This function is not an executive function as contemplated under the Constitution or under any legislation. The "Governor" in this context is to be understood as an incorporation by reference to the executive function to be exercised by the Government in the name of Governor. The reference W.P(c).No.3267/2017 & conn.cases 7 iin the byelaw "to have a prior approval of Governor" therefore must be understood in regard to the satisfaction by the Government on the viability of the Company having enhanced age of retirement from 58 years to 60 years. This do not depend upon any policy of Government. The policy of the Government being discharged through an executive function has nothing to do with the duty being discharged in terms of the Articles of Association of the Company. It is obvious that the matter of enhancement of age of retirement of employees is not placed before the Council of Ministers for their advice or views. The decision was to be taken by the Government with a specific reference to the company in terms of the Memorandum of Association of the Company.
8. As afore-noted, the decision of the government for enhancement of the age of of the employees of KSFE is not depend upon any policy of the Government."
11. Further it was found that the decision of the Government for enhancement of the age of retirement of employees of the KSFE cannot depend upon any policy of the Government but it should be taken independently. The impugned orders were set aside directing the Government to take appropriate decision on the basis of the resolution dated 25.6.2014 of the Board of Directors in its 460th meeting within two months. The writ petitioners were allowed to continue till a decision was taken by the Government. It was further made clear that payment of salary to the employees who are continuing based on the interim order would depend upon the outcome of the decision of the Government.
12. Thereafter, the Government issued Ext.P7 order, on 20.05.2015 saying that the service conditions of the employees in KSFE was approved by the Governor under Article 30 (xi) of Articles of Association of KSFE W.P(c).No.3267/2017 & conn.cases 8 Ltd; this approval was conveyed as per G.O.(Ms). 40/74/T.D dated 21.03.1974; as per para 17(1) of the said conditions, the age of superannuation is fixed as 58 years. As per the Memorandum of Association and Articles of Association of the Company, the Government has got every privilege to control the affairs of the Company; as per sub clause (xi) of clause 30 of the AOA, the rules of the Company governing the conditions of service of the employees require prior approval before it can be set in motion; a resolution adopted by the Board of Directors regarding the enhancement of retirement age of the employees will be enforceable only with the Government approval. The Government thereupon decided not to enhance the retirement age, after considering all the aspects and to maintain status quo as to the age of retirement as provided in paragraph 17(1) of the Standing Orders applicable to the employees of KSFE.
13. Ext.P7 order was challenged in W.P).No.16330 of 2015 and connected cases. Seeing that no reasons were stated for not enhancing the retirement age, interim orders were passed on 03.06.2015, directing the respondents to allow the petitioners to continue in service provisionally without any claim for salary. Thereafter, by Ext.P9 judgment dated 14.07.2015, this Court set aside Ext.P7 order, seeing that it was a cryptic W.P(c).No.3267/2017 & conn.cases 9 one, not supported by any reasons. Government was thereupon directed to reconsider the matter and to pass a reasoned order on the basis of observations contained in Ext.P6 judgment. As the petitioners in those cases had been continuing without salary, the respondents were directed to pay them 50% of their respective salary for the subsistence. The Government was given liberty to take a decision on the question of adjustment of any payment made to a pensioner in those writ petitions.
14. Pursuant to that, Government issued Ext.P10 order on 17.10.2015, rejecting the resolution, adding two more sentences to Ext.P8 order, saying that at present retirement age of majority of PSUs in Kerala is 58, though in some PSUs, it is higher or lesser; increasing retirement age in one PSU will lead to similar demand from other similarly placed PSUs. Ext.P10 order was again challenged, in several of the writ petitions in this batch. Seeing that there was no objective consideration and that the defects pointed out in Ext.P9 judgment continued to subsist, a learned Single Judge issued Ext.P11 interim order on 27.7.2016, directing the Government to reconsider the matter and to place the orders before this Court. It was further ordered as an interim arrangement that those who reached the age of 60 and required to be superannuated would be paid 75% of the retirement W.P(c).No.3267/2017 & conn.cases 10 benefits reckoning the age of retirement on completion of 58 years and the last pay drawn as on the date on which they attain 58 years. The question of payment of salary, was left for the decision of the Government. Those who reached the age of 58 years were permitted to continue as directed in Ext.P9 judgment, declaring their entitlement for salary to the extent of 50%.
15. Thereafter the Government issued Ext.P12 order again rejecting the proposal. Referring to the decision of the Board of Directors highlighting the role of the competitors for supporting the enhancement of retirement age, it is stated that such a threat was not visible and if at all threats are emerging it should be from large corporates and in such cases young blood can take on better as they are updated in techniques and technologies. It was further stated that the enhancement of retirement age of newly recruited personnel under the Government on introduction of National Pension Scheme cannot be made applicable to employees of KSFE. The KSFE is a commercial establishment and the employees have entered service after agreeing to all the service conditions including retirement and hence cannot claim parity of retirement age with the State Government employees; the pay structure, terminal benefits and superannuation benefits of the employees of the KSFE are very high; the W.P(c).No.3267/2017 & conn.cases 11 Company can easily tackle with current issues in market management as it is recruiting talented youths to cop with the technological and market challenges. Therefore, the question of brain drain will not arise. It is stated that the productivity per employee and profitability per employee have a strong bearing on the existence and prosperity of the company; the lower retirement age, average pay etc. will add profitability parameters to the vibrant PSU; a major chunk of operating expense is meant for salary and other staff costs. It was therefore stated that enhancement of retirement age will raise the staff cost substantially, but without any considerable efficiency improvement. The enhancement of retirement age was therefore not found viable. It is further stated that even in the bilateral agreement with the management on salary and service conditions during 2015, the age of retirement continues to be 58 years. It is stated that retirement age was enhanced in some institutions long back considering the special circumstances prevailing there like shortage of experts; there is no such special circumstances in the case of KSFE which is one of the important profit making PSUs in the State. Enhancement will create financial burden to the company on account of payment of salary and other benefits and it will in turn practically affect the profitability. After rejecting the resolution, W.P(c).No.3267/2017 & conn.cases 12 sanction was accorded to KSFE to pay 75% of the retirement benefits of the employees who were superannuated at the age of 60 years computing their retirement benefits treating their retirement as 58 and reckoning the last pay drawn as on that day.
16. Ext.P12 is now under challenge in all these writ petitions. According to the petitioners, the respondents are bound by the interparte judgment in the cases already decided and therefore Ext.P12 order is also liable to be set aside. They are also aggrieved by the fixing of the retirement benefits at 75%.
17. Whileso, the Board of Directors in its 499th meeting held on 08.05.2017 resolved to withdraw the recommendation to the Government to enhance the retirement age from 58 years to 60 years taken as per Ext.P1 resolution dated 25.06.2014 and decided to continue with the existing age of retirement of 58 years. A copy of the resolution is produced as Ext.R3(a) along with I.A No. 8043 of 2017 in W. P.(C) No. 36211 of 2015. The reason stated for the withdrawal is the rejection of the recommendation by Government.
18. In the counter affidavit filed on behalf of respondents 1 and 2 in W.P(c).No.2793 of 2017 it is stated that under the provisions contained in W.P(c).No.3267/2017 & conn.cases 13 sub clause xi of clause 30 of the Articles of Association of the KSFE, the provisions governing the terms and conditions of service of the employees require the prior approval of the Government. Ext.P1 resolution, which is passed without the prior approval of the Government is null and void. The petitioners continued in service beyond the age of 58 years, on the strength of interim orders. According to the respondents, the petitioners who joined service after accepting the terms and conditions of employment including the retirement age are estopped from claiming enhancement of retirement age. It is stated that even in the long term agreement signed between the unions representing the employees of the KSFE and the management settling the scale of pay and other terms and conditions of service in the year 2015, enhancement of retirement age is not a subject matter. While admitting that the 3rd respondent company is a fairly good pay master and that the productivity per employee and profitability of employee have a strong bearing on the very existence and prosperity of the company. It is stated that the present retirement age will add to the profitability parameters of the 3rd respondent. The enhancement of retirement age will enhance the staff cost substantially without any improvement in the efficiency which will have any adverse impact on the company's financial position. Any W.P(c).No.3267/2017 & conn.cases 14 decision for enhancement of retirement age will adversely affect the interest of the youth, who are awaiting retirement through the KPSC. The Government, after considering the matter at the highest level in the cabinet, and considering the entire case and consequences likely to be resulted, rejected approval to the resolution of the company. It is further stated that the Government cannot turn its back towards the burning issue of unemployment to the millions of the educated youth. The social, economic and political requirements and needs of the society will not favour Ext.P1 decision of the 3rd respondent to enhance the retirement age from 58 years to 60 years. The reasons stated in Ext.P1 are not really existing or genuine as far as the State is concerned. According to the respondents the standard of experience and skill as required in the case of Doctors, Professors, Engineers etc. is not required in the case of employees of a non banking financial institution like KSFE. The company is a miscellaneous non banking financial company fully owned by the Government. Any financial burden or loss to the company would directly affect the State exchequer. Government after examining the case found that there is no emergent situation warranting enhancement of retirement age. The present situation requires need and necessity to bring in maximum youngsters with higher W.P(c).No.3267/2017 & conn.cases 15 qualification and up-to-date knowledge on technological and other aspects in its key position. It is further stated that the decision is guided by the Govt. policy not to enhance the retirement age of employees of public sector undertaking. According to the Government, no specialised skill or knowledge is necessary for the conduct of the business of KSFE. The retirement age is fixed based on various factors such as the social and economic requirement of society, chance of employment opportunity, availability of fresh hands, special advantage to be gained by allowing the existing employees to continue beyond a particular age. There is no special circumstances warranting the retirement age as in the case of teaching staff of Government Medical/Ayurveda/Homoeopathic colleges following UGC regulations or that of the Agricultural Income tax and Sales Tax Appellate Tribunal, State Vigilance Tribunal etc. having the status of judicial officers. It is stated that no decision has been taken to enhance the retirement age in public sector undertakings subsequent to 2011. Enhancement of retirement age will block the promotion chances of those in lower strata creating unrest among the junior employees affecting the smooth and harmonious atmosphere in the institution. The discontentment of unemployment including the rank list prepared by the PSC and of the existing employees W.P(c).No.3267/2017 & conn.cases 16 eligible for promotion are the concern of the Government. Therefore, there is no reason for interfering with the order passed by the Government.
19. In the light of the subsequent development, the learned counsel appearing for the respondents submitted that the very basis for the challenge against the order passed by the Government, ceased to exist.
20. Sri P.Sreekumar, learned Counsel for some of the petitioners argued that the Government does not have any authority to reject the proposal for enhancement of the retirement age. Clause 30 of the Articles of Association of the KSFE provides for the matters which require prior approval of the `Governor'. Clause (xi) thereof is rules of the company governing the conditions of service of the employees, Provident Fund and other rules, creation of reserve and special funds. As per clause 2(x) of the Articles of Association, "Governor" means Governor of Kerala. Therefore, it is the contention of the learned counsel that approval has to be granted by the Governor and not by the Government. Relying on the judgment in Gopalakrishnan V Chancellor, University of Kerala: 1990 (1) KLT 681, it is argued that the role of the Governor is in his capacity as a share holder and the order passed by Government is without any authority. It was pointed out that under clause 14 of the Articles of Association, Governor has to W.P(c).No.3267/2017 & conn.cases 17 nominate his representatives to attend the meetings of the company. Sub clause (a) provides that the Government, may from time to time appoint one or more persons to represent him at all or any of the meetings of the company and the persons so authorized shall be entitled to exercise the same powers on his behalf as if they are individual share holders of the company personally present. Sub clause (b) provides that a person appointed under sub clause (a) who is personally present at the meeting shall be entitled to represent the Governor at all or any such meetings. Similarly sub clause (c) provides that the Governor may from time to time cancel any appointment made under sub clause (a) and make fresh appointments. Clause 18 provides that the first directors and all subsequent directors shall be appointed by the Governor and that Governor shall hold office during the presence of the Governor. Therefore, it is argued that once the Directors appointed by the Board passed a resolution, Governor or Government cannot take any other action. Alternately it is contended that if at all it is to be understood as Government, the Government cannot go back from the resolution. It is pointed out that before withdrawing the resolution, KSFE has not stated any reasons apart from the fact that the Government did not accept the proposal. In the absence of any reason, the withdrawal of the W.P(c).No.3267/2017 & conn.cases 18 resolution will not stand and the original resolution would stand. Under Section 179 of the Companies Act 2013, the decision of the Board of Directors cannot be varied by the Government and such resolutions are liable to be implemented. According to the learned counsel even the Articles of Association which requires prior approval of Governor is contrary to the provisions in the Companies Act. According to him, when there is a resolution, there is approval. Referring to Articles 154, 163 and 166 of the Constitution of India, it is argued that the Governor as envisaged in the Articles of Association is not one who functions with the aid and advice of the council of Ministers. He has to act independently and the Government has no role in the executive affairs of the company. The judgment of the Apex Court in Vijayadevi Navalkishore Bhartia v. Land Acquisition Office,[(2003) 5 SCC 83], was also relied on.
21. The learned counsel Sri Sreekumar, relying on the judgment in Nibro Ltd v. National Insurance Co Ltd: 1991 (70) Company Case (Del.) 390 and Western Coal Fields Ltd v. Notified Area Council: AIR 1981 Or. 18, argued that when the act cannot be done under the provision of the Act, it cannot be done on the strength of any rule or decision. It was argued that if the resolution Ext.P1 was passed with sufficient reasons, then the general W.P(c).No.3267/2017 & conn.cases 19 body cannot annul that decision of the Board of Directors. It is also pointed out that under section 6 of the Companies Act 2013, any resolution shall have effect from the date on which the resolution is passed and no approval is necessary. Relying on the judgment in Vijayadevi Navalkishore Bhartia v. Land Acquisition Officer, (2003) 5 SCC 83, it was also argued that if at all approval is necessary, that can only be by way of assent or ratification or otherwise it would be in violence of the Act.
22. According to the learned Senior Counsel Shri T.A.Shaji, there is no pension scheme available in the KSFE and the retirement age is governed by clause 18 of the standing orders. This Court had directed the respondents to take a decision independently considering the viability. Exts.P9 and P8 judgment are interparte judgments between the employees of the KSFE with KSFE and the Government on the party array and as long as the findings in those judgments are not challenged and have become final, the respondents cannot wriggle out of the same. The learned Senior Counsel pointed out that this Court has in the judgment in W.P.(C) No.35407 of 2007 in the case of Lifestock Development Board, W.P.(C) No 11794 of 200 as upheld in W.A. 2313 of 2007 in the case of Kerala Shipping and Navigation Ltd, W.P.(C) No. 9460 of 2007 in the case of Kerala Forest W.P(c).No.3267/2017 & conn.cases 20 Development Corporation, W.P.(C) No. 22320 of 2008, etc., set aside the orders passed by the Government denying approval to the resolutions passed by similar companies and allowed the employees to continue in service in accordance with the resolutions of the respective Companies. It is argued that the order passed by the Government is contrary to the directions contained in those judgments. According to the learned Senior Counsel, the employees of KSFE are subjected to discriminatory treatment, while enhancement is already granted in the case of employees of certain other companies. Relying on the judgments in Union of India v. Central Administrative Tribunal, Ernakulam Bench :2002 (1) KLT 840, Peirce Leslie India Ltd. v. Secretary, C.I.T.U :2006 (1) KLT 869, etc, it is argued that the judgment interparte cannot be nullified, by repeated rejection of approval. The learned Senior Counsel pointed out that when a direction was issued to the Government to pass orders on the proposal for enhancement of retirement age by this Court in judgment dt.20.2.2014 in W.P.(C)No.27353 of 2013, the respondents did not have any objections. The impugned order does not refer to any deliberation and there is no material for arriving at the decision contained in the impugned order. It is pointed out that once the standing orders are issued, the retirement age can be W.P(c).No.3267/2017 & conn.cases 21 enhanced by agreement between employees and the employer as held in UPSEB V Harisankar Jain [(1978) 4 SCC 16]. It is also pointed out that the employees of the KSFE are subjected to discrimination and this proft making company is making the payment to meet all the liabilities from their own funds. When a decision was taken in the case of K-BIP on 31.7.2014, as per Ext.P14 order, enhancing the retirement age, the rejection of the proposal in respect of KSFE was discriminatory. It is also pointed out that in case the resolution was considered with reference to viability of the company, a decision would have been taken in their favour. Right from 2014 this Court had been directing the respondents to take a decision, on the viability of the company, the Government ought not have looked into any other aspect. The learned counsel pointed out that peculiar circumstances arise in this case inasmuch as the KSFE is one of the big companies which makes profit. Therefore, according to them they are entiled to be paid salary in full.
23. The petitioners have a further contention that the action of the Government in limiting the DCRG to 75% denying them the salary for the period when they continued on the basis of interim orders is arbitrary. According to them, the interim orders were issued directing payment of W.P(c).No.3267/2017 & conn.cases 22 50% salary, seeing that, the action of the Government was arbitrary and there is no reason why they should be denied salary after utilising their services.
24. Relying on the judgment in Kavirajan V KSBC Ltd: 2007(2) KLT 917, Sri. Raghuraj argued that when there is hostile discrimination between similarly placed other employees in other corporations, the action of the Government is arbitrary and in violation of Article 14 of the Constitution of India. Pointing out the profit gained by the company, it is argued that the company has gained much because of the service rendered by experienced hands like them, which the young talents will not able to do. It is also pointed out that the company is going on with the recruitment and their retention is not blocking the way of fresh entrants. It is also pointed out that there are at least 17 Public Sector Undertakings in the State in which the retirement age is 60 years. As the Government has enhanced the retirement age in the case of Statutory Officers in the Universities, employees in Institute of Management of Government, etc., it is pointed out that the rejection of approval in their case is illegal.
25. The learned counsel for the petitioners, relying on the interparte judgments Ext.P6 and Ext.P9 and the findings in the interim order Ext.P11, W.P(c).No.3267/2017 & conn.cases 23 argued that the only consideration of the Government ought to have been the viability of the company as directed in Ext.P6 judgment and that in such an event, the largest profit making company would have been permitted to enhance the retirement age.
26. The contention of Sri. K.K.Ravindranath, the learned Addl.Advocate General is that para.7 of Ext.P6 judgment (extracted supra) itself is an answer to repel the contention raised by Sri P.Sreekumar that Governor mentioned in the Articles of Association is not Government. Referring to 'Ramiyya's Guide to the Companies Act, Providing guidance on the Companies Act, 2013', P.200, it was pointed out that as per the Department's letter referring to a circular issued by the Government of India, the President or Governor functioning under the Constitution is not a corporate sole. As provided in Article 77(1) and 166(1) of the Constitution all executive action of the Government of India and Government of State shall be expressed to be taken in the name of President or the Governor as the case may be. The acquisition or holding of shares in a company by the Government of India or a State Government is an executive action as contemplated by Article 77(1) and 166(1) of the Constitution and can be made in the name of President of India or the Governor of a State. It is W.P(c).No.3267/2017 & conn.cases 24 further argued that viability of an institution has to be considered not only with reference to the financial conditions, but also with reference to the working conditions. It was further pointed out that in Ext.P9 judgment this Court interfered with the order of Government since there was no reason supporting the decision of Government. This Court had not gone into the merit of the decision. It is further pointed out that in the case of KTDC, TCC, KFC and also KLDC, the Government had not permitted enhancement. As per Article 36 of the Articles of Association a decision can be taken affecting the service conditions, only with the approval of the Government. The learned Addl.Advocate General relied on the judgment in K. Nagaraj & Ors. v. State of A.P and another [(1985) 1 SCC 523], State of Kerala Vs Kerala Land Development Corporation [ILR 2016 (2) Ker 81], judgment in W.P(c).7017/2016 in the case of TCC, Sheela V State of Kerala & others [ILR 2016(4) Ker 576] in the case of employees in KFC, Managing Director KSBC v. Gopi [ILR 2015 (3)Ker.794], and the judgment in W.P.(C) No.20100 of 2014 in the case of employees in KSEB, in support of his contentions defending the impugned order. It was argued that petitioners who at their risk continued in service, are not entitled to any remuneration. The judgments in Radha kishun V Union of India & others W.P(c).No.3267/2017 & conn.cases 25 (1997) 9 SCC 239, judgment dated 7.4.2015 in W.P(c).No.27784 of 2015, which was upheld in the judgment dated 13.06.2016 in W.A.2043 of 2016 , judgment in 20100/2014 and Sheela's case (supra) were relied on and it was argued referring to each of the interim orders in these cases that the continuance of the petitioners were at their risk and even when payment of 50% salary was directed as per Ext.P11 order on 27.7.2015, the question of adjustment of the same with retirement benefits was left open and therefore petitioners cannot have any claim for any remuneration.
27. Sri P.Gopinath, learned Standing counsel for the 3rd respondent company pointed out that being a company with 100% share held by the Government, the Directors of the 3rd respondent company are bound by the decision of the Government. They are also bound to refer the matter to the Government for approval, pointing out the standing order which provides for the retirement age at 58 years, modification of which requires the permission of the Government. Relying on the judgment in Sureshchandra Singh v. Fertilizer Corpn. of India Ltd., [(2004) 1 SCC 592], it is argued that the plea of discrimination would not lie. Reference was also made to Section 291 of the Companies Act 1956, which is in tune with Section 179 of the 2013 Act. It was also pointed out that the learned Single Judge had in W.P(c).No.3267/2017 & conn.cases 26 Ext.P6 judgment explained what is meant by the approval of Governor.
28. I heard the learned Senior Counsel as well as the learned Counsel appearing for the petitioners and the learned Additional Advocate General and the learned Standing Counsel for the KSFE.
29. The Board of Directors have cancelled the resolution requesting for enhancement of retirement age, based on which the petitioners were claiming enhancement. They have decided to retain the retirement age at 58, in tune with the Government decision. Therefore, as at present there is no resolution which is in force, for enhancement of the retirement age.
30. I have considered a similar case in my judgment dated 04.04.2017 in W.P.(C) No.7107 of 2016 and connected cases filed by the employees of Travancore Cochin Chemicals Ltd (TCC), another Government Company, in which the request for enhancement of retirement age, was not allowed. There also the original decision to enhance the retirement age was cancelled, when Government did not accede to the request of the company for enhancement. It was also a case where any change in the service conditions of the employees required prior approval from Government, as in the present case. Those writ petitions were dismissed, following the judgment of the Division Bench of this Court in W.P(c).No.3267/2017 & conn.cases 27 State of Kerala v. Kerala Land Development Corporation Employees Union [I.L.R. 2016 (2) Kerala 81] in which the decision of the Government rejecting the recommendation of Board of Directors of Kerala Land Development Corporation for enhancement of the retirement age, was upheld.
31. In the light of para.7 of Ext.P6 judgment and the explanation furnished by the Government of India, in its letter and the Government circular pointed out by the learned Additional Advocate General, from 'Ramiyya's Guide to the Companies Act, providing guidance on the Companies Act, 2013, P.200, I am unable to accept the contention raised by Sri. P.Sreekumar with reference to the role of Governor. Contentions referring to the effect of resolution of Director Board, meaning of approval, conflict in provisions of Articles of Association with provisions of Companies Act, etc. also, as long as the issue raised in this case is with respect to the retirement age, are governed by the standing orders. The standing order determining the retirement age at 58 or the provisions which provide for prior approval of Governor for alteration of service conditions of employees in a company fully owned by Government are not under challenge in these writ petitions.
W.P(c).No.3267/2017 & conn.cases 28
32. The contentions raised by the learned Counsel for the petitioners relying on the judgments in 2006 (1) KLT 869 :Peirce Leslie India Ltd. v. Secretary, C.I.T.U and Union of India v. Central Administrative Tribunal, Ernakulam Bench :2002 (1) KLT 840, Ext.P12 order is not in tune with the Judgments intra-parties, which have attained finality, cannot also be accepted. Those judgments were rendered at a time when the Government did not furnish any reason for the rejection and simply referred to the policy decision, without stating any reasons to support the same. Moreover the inter-parte judgments, which the petitioners rely were all rendered at a time when the resolution of the company was for enhancement of retirement age. Now there is no such resolution. The pendency of writ petitions challenging the Government's decision will not stand in the way of the Company passing a resolution to retain the retirement age as such, even if the reason for the same is the decision of the Government rejecting the first resolution. It is also pertinent to note that `viability' means workability or feasibility. Ext.P12 is seen issued after considering the viability of the company.
33. It is admitted on both sides that Clause 30(ix) of the Articles of Association of the Company mandates prior approval for any alteration in W.P(c).No.3267/2017 & conn.cases 29 the service conditions. It is an admitted fact that the Standing Orders provide for the retirement age of 58 years. The respondents point out that even in the agreement entered into by the employees with the Company in 2015, there is no difference in the retirement age.
34. In the order Ext.P12, the Government have considered the issue with reference to the grounds on which the Director Board took the original decision for enhancement and rejected each of those grounds after giving reasons for coming to the conclusion. The petitioners cannot have any right to insist that they should be allowed to continue beyond the retirement age just because the Company is making profit.
35. In K.Nagaraj v. State of A.P [1985 (1) SCC 523] the Apex Court held that the policy issues like the age of retirement are not liable to be interfered with by the courts in exercise of judicial review and it is an exercise which the Administrator and the legislature have to undertake. There the employees challenged the lowering of retirement age from 58 years to 55 years. The following observations in that judgment are relevant, which read as follows:
"28. xxxx xxxIt is not possible to lay down an inflexible rule that 58 years is a reasonable age for retirement and 55 is not. If the policy adopted for the time being by the Government or the Legislature is shown to violate recognised norms of employment planning, it would be possible to say that the policy is irrational since, in that event, it would not bear reasonable nexus with the object which it seeks to achieve. But such is not the case here.W.P(c).No.3267/2017 & conn.cases 30
The reports of the various Commissions, from which we have extracted relevant portions, show that the creation of new avenues of employment for the youth is an integral part of any policy governing the fixation of retirement age. Since the impugned policy is actuated and influenced predominantly by that consideration, it cannot be struck down as arbitrary or irrational. We would only like to add that the question of age of retirement should always be examined by the Government with more than ordinary care, more than the State Government has bestowed upon it in this case. The fixation of age of retirement has minute and multifarious dimensions which shape the lives of citizens. Therefore, it is vital from the point of view of their well-being that the question should be considered with the greatest objectivity and decided upon the basis of empirical data furnished by scientific investigation. What is vital for the welfare of the citizens is, of necessity, vital for the survival of the State. Care must also be taken to ensure that the statistics are not perverted to serve a malevolent purpose."
36. In this context it is necessary to have a look at the judgment of the Apex Court in Nagaland Senior Govt. Employees Welfare Assn. v. State of Nagaland, (2010) 7 SCC 643 , while it was considering the validity of a rule which prescribed retirement from public service at the age of 60 years or on completion of 30 years of service, whichever is earlier. It was held as follows:
"50.xxxx. It cannot be overlooked that the whole idea behind the impugned provision is to create opportunities for employment and check unemployment. The impugned provision is aimed to combat unrest amongst educated unemployed youth and to ensure that they do not join underground movement. As observed by this Court in State of Maharashtra v. Chandrabhan Tale :(1983)3 SCC 387 public employment opportunity is national wealth in which all citizens are equally entitled to share."
The objects and reasons for the amendment of that rule are available in paragraph 47 of the judgment which read as follows.
"47. The Statement of Objects and Reasons appended to the Amendment Bill expressly states as follows:
"Whereas there are a large number of educated unemployed youths in Nagaland registered in the employment exchanges of Nagaland, who are in search of white-W.P(c).No.3267/2017 & conn.cases 31
collared employment, particularly under the government sector; And whereas, such white-collared employment opportunities outside the government sectors are very negligible due to less presence of organised private sector, and the employment avenues in the government sector are also already saturated; and new job opportunities, in the government sector arising out of normal retirement vacancies, or creation of new jobs are inadequate to cater to the rising expectations of the educated youth for white-collared employment;
And whereas, the State Government, being a welfare State, considers it necessary that job opportunities under the government sector should be shared by the citizens in a more equitable manner, and that this objective can be better achieved by fixing the upper age-limit for retirement from government service, as well as by setting a limit on the maximum number of years a government servant may be allowed to be in government service;
Therefore, the State Government considers it expedient to introduce a Bill in the State Assembly that would set a limit on the number of years a person may be allowed to be in the service of the State Government, by fixing the upper age-limit, as well as the maximum length of service for any person to be in government employment."
It is pertinent to note the observations in paragraph 7 of the judgment in Nagaraj's case, which read as follows:
"7. ... The fact that the stipulation as to the age of retirement is a common feature of all of our public services establishes its necessity, no less than its reasonableness. Public interest demands that there ought to be an age of retirement in public services. The point of the peak level of efficiency is bound to differ from individual to individual but the age of retirement cannot obviously differ from individual to individual for that reason. A common scheme of general application governing superannuation has therefore to be evolved in the light of experience regarding performance levels of employees, the need to provide employment opportunities to the younger sections of society and the need to open up promotional opportunities to employees at the lower levels early in their career. Inevitably, the public administrator has to counterbalance conflicting claims while determining the age of superannuation. On the one hand, public services cannot be deprived of the benefit of the mature experience of senior employees; on the other hand, a sense of frustration and stagnation cannot be allowed to generate in the minds of the junior members of the services and the younger sections of the society. The balancing of these conflicting claims of the different segments of society involves minute questions of policy which must, as far as possible, be left to the judgment of the executive and the legislature. These claims involve considerations of varying vigour and applicability. Often, the court has no satisfactory and effective means to decide which alternative, out of the many competing ones, is the best in the circumstances of a given case. We do not suggest that every question of policy is outside the scope of judicial review or that, necessarily, there are no manageable standards for W.P(c).No.3267/2017 & conn.cases 32 reviewing any and every question of policy. Were it so, this Court would have declined to entertain pricing disputes covering as wide a range as cars to mustard oil. If the age of retirement is fixed at an unreasonably low level so as to make it arbitrary and irrational, the court's interference would be called for, though not for fixing the age of retirement but for mandating a closer consideration of the matter. `Where an act is arbitrary, it is implicit in it that it is unequal both according to political logic and constitutional law and is therefore violative of Article 14.' [E.P. Royappa v. State of T.N., SCC p. 38, para 85 : SCC (L&S) p. 200] But, while resolving the validity of policy issues like the age of retirement, it is not proper to put the conflicting claims in a sensitive judicial scale and decide the issue by finding out which way the balance tilts. That is an exercise which the administrator and the legislature have to undertake. As stated in `The Supreme Court and the Judicial Function' (Edited by Philips B. Kurland, Oxford & IBH Publishing Co., p. 13):
`Judicial self-restraint is itself one of the factors to be added to the balancing process, carrying more or less weight as the circumstances seem to require'."
This position is reiterated by another three Judge Bench of the Apex Court in the judgment in Union of India v. A.K. Behl, [(2015) 9 SCC 256] in paragraphs 15 and 16, while considering the retirement age of Lieutenant Generals in the Army.
37. In T.P. George v. State of Kerala [(1992) Supp.(3) SCC 191] this Court held that even when the age of retirement fixed at 55 years in the case of teachers of affiliated colleges was found too low, considering the several years of teaching experience before they really become adept in their jobs, it was held that it is not for the courts to prescribe the correct age of retirement. But a policy function requiring considerable expertise can be done only by the State Government or the State Legislature. The Apex Court left the matter to the Government to determine the age of retirement W.P(c).No.3267/2017 & conn.cases 33 considered suitable in its wisdom. In B.Bharat Kumar v. Osmania University [(2007) 11 SCC 58] where this Court observed : [ (SCC p. 73, para 19).
"19. ... it is not for this Court to formulate a policy as to what the age of retirement should be as by doing so we would be trailing into the dangerous area of the wisdom of the legislation. If the State Government in its discretion, which is permissible to it under the scheme, decides to restrict the age and not increase it to 60, or as the case may be, 62, it was perfectly justified in doing so."
Similarly there cannot be any plea of discrimination referring to other companies, as held in Sureshchandra Singh v. Fertilizer Corpn. of India Ltd. [(2004) 1 SCC 592], that each public sector undertaking is an independent body/entity and is free to have its own service conditions as per law. There it was held that the employees of different corporations could not be treated alike since every corporation will have to take into account its separate circumstances so as to formulate its policy. The argument that there is discrimination of appellants vis-`-vis employees of other corporations was repelled.
38. In State of Kerala v. Adithikutty Amma, D. [ILR 2010(4) Kerala 572], a Division Bench of this Court upheld the decision of Government rejecting the request in the resolution of the Director Board of Warehousing Corporation to enhance the retirement age of its employees W.P(c).No.3267/2017 & conn.cases 34 from 55 to 58. While reversing the decision of the learned Single Judge, the Division Bench held that when prior sanction is required from the appropriate Government, for amendment of any of the provisions in the service rules and if the Government declines the same, the Warehousing Corporation which is not a statutory body is bound to accept the decision of the Government. It was found that Board of Directors were to manage the corporation in terms of the regulation framed under Section 42 which in turn can be done only with the approval of the State Government. Warehousing Corporation is formed with the investment of State Government, Central Government and Central Warehousing Corporation. The question regarding the requirement of passing a reasoned order by the Government, was also considered in that case and it was found that no separate reasoning is necessary since it is a policy matter. However, it was found necessary for the Government to reconsider the decision in the light of the decision taken in respect of certain other public sector undertakings.
39. Therefore this Court will not be justified in interfering with such decisions under Article 226 of the Constitution of India as the order Ext P12 contains the reasons for arriving at a decision, which are similar to those reasons which are upheld in Nagaraj's case (supra). The question W.P(c).No.3267/2017 & conn.cases 35 regarding finality of interparte judgment does not arise now on more than one ground. Firstly the resolution based on which enhancement is claimed does not exist. Secondly the Government has considered the request and passed orders with reasons. That being so, the question of judicial review of such orders does not even arise. The position is clearly laid down in Nagaraj's case.
40. The KSFE is a company fully owned by the Government and any change in conditions of service requires approval. When the Government on the basis of a policy decision took the view that retirement age need not be enhanced, this Court will not be justified in interfering with that decision and direct enhancement of retirement age. The reasons for arriving at that decision is explained in the order passed by the Government. Therefore, I do not find any illegality in Ext.P12 order rejecting approval for enhancement.
41. The next question to be considered is regarding claim raised for payment of salary and the terminal benefits being granted pointing out the interim orders passed in their case by which they were allowed to continue beyond the age of 58 and when 50% of their salary was directed to be paid.
42. It is true that the Apex Court in Radha Kishun's case (supra) W.P(c).No.3267/2017 & conn.cases 36 and this Court in various judgments relied on by the learned Additional Advocate General has denied salary for the period during which the employees continued on interim orders at their risk. In the present case also the petitioners continued at their risk. But in Ext.P9 judgment, this Court found it necessary to direct payment of 50% of the salary, though it was subject to the final decision. The continuance from the date of judgment Ext.P9 was only because of the action of Government in not passing orders as directed by this Court. Therefore, even though the petitioners do not have any legal right to claim salary when they continued at their risk, it will not be just or proper to deny them remuneration totally, from the date of Ext.P9 judgment, i.e 14.07.2015. At the same time, I do not find any reason for limiting retirement benefits due to the petitioners to 75%. The petitioners who continued on the basis of the interim orders, beyond the age of 58 years shall be entitled to monthly wages at the rate of 50% of their pay drawn by them as on the date on which they attained 58 years for the period from 14.07.2015/any subsequent date on which they attained 58 years till the date on which they attained 60 years or got relieved otherwise or the date of judgment, whichever is earlier. It is made clear that 50% salary already paid to the petitioners on the basis of the interim orders can be W.P(c).No.3267/2017 & conn.cases 37 adjusted from the above amounts thus due to the petitioners. The KSFE is therefore directed to settle the payments due to the petitioners accordingly within a period of three months.
The writ petitions are disposed of with the above directions.
Sd/-
(P.V.ASHA, JUDGE) rtr/