Jharkhand High Court
Hindustan Steel Works Construction ... vs Shiva Kant Jha @ S.K. Jha on 22 February, 2005
Equivalent citations: 2005(1)BLJR534, 2005 LAB. I. C. 2782, 2005 AIR - JHAR. H. C. R. 1496, (2005) 3 SCT 640, (2005) 8 SERVLR 250, (2005) 2 JLJR 252, 2005 BLJR 1 534
Author: M.Y. Eqbal
Bench: M.Y. Eqbal, Hari Shankar Prasad
JUDGMENT M.Y. Eqbal, J.
1. This Letters Patent Appeal is directed against the judgment dated 5.8.2003 passed in C.W.J.C. No. 1704 of 2000 (R) whereby learned Single Judge allowed the writ petition and quashed the impugned order as contained in letter dated 3.4.2000 whereby the petitioner-respondent was informed that his request for voluntary retirement from the service has not been accepted by the Company.
2. Facts of the case lie in a narrow compass.
3. Petitioner-respondent was in the services of the appellant Hindustan Steel Works Construction Limited and appointed as a Junior Assistant. He was promoted from time to time and in 1996 he was holding the post of Manager (Public Relations). Appellant-Company introduced a voluntary Retirement Scheme for the purpose of reducing the manpower and thereby making the Company economically viable. According to the petitioner-respondent, he opted for voluntary retirement w.e.f. 31.10.1999 and, therefore, he filed an application to that effect on the printed format supplied by the Company on 8.9.1999. It is alleged that after verification and clearance from the vigilance and the other department and after being fully satisfied the Group General Manager recommended and forwarded the application to the competent authority at Calcutta for acceptance. Thereafter the Chairman-cum-Managing Director being fully satisfied accepted his offer for voluntary retirement w.e.f. 31.10.1999 and accordingly a letter was prepared in the name of the petitioner-respondent through the Group General Manager on 12.10.1999 informing the petitioner-respondent that his request for voluntary retirement had been accepted by the Management and that he would retire from the services of the Company w.e.f. the afternoon on 31.10.1999. The said letter was not officially given to the petitioner-respondent. However, the petitioner-respondent could get a copy of the same from Calcutta office. Petitioner-respondent's case was that since the Group General Manager of the Company was not releasing the said letter, he wrote letter on 26.10.1999 wherein he demanded that the same be released and handed over to him so that he may be able to voluntarily retire. In the meantime, appellant Company issued letter to the petitioner-respondent informing him that his application for voluntary retirement was still in process and that there were other impending matters which required to be cleared before conveying acceptance. Another letter was issued by the appellant-Company on 1.11.1999 informing the petitioner-respondent that he was not being released under the Voluntary Retirement Scheme w.e.f. 31.10.1999. Thereafter petitioner-respondent wrote several letters, addressed to Chairman-cum-Managing Director for voluntary retirement but the same had not been accepted by the Company.
4. The case of the appellant-Company in the counter-affidavit was that the letter prepared for acceptance of the voluntary retirement of the petitioner-respondent was conditional and that it was never served upon the petitioner-respondent. Petitioner-respondent obtained a copy of the order in a fraudulent way. Appellants-respondents' further case was that he was duly informed by the appellant-Company that his offer for voluntary retirement had not been accepted. Petitioner-respondent sent a letter vide letter dated 8.11.1999 informed the Group General Manager of the Company that he was out of Bokaro Steel City till 15th November, 1999 and, therefore, he may be allowed earned leave and that he would be absenting till resumption of his duty. Petitioner-respondent thereafter joined his duty on 19.11.1999.
5. In the light of the aforesaid facts, the learned Single Judge recorded the following finding :-
"11. Thus, the inescapable conclusion that this Court must arrive at is that the letter dated 12.10.1999 was a stark reality and it had been issued, but for reasons best known to the concerned officers, it was not served upon the petitioner. It is true that in all cases of cessation and/or termination of employment, the same comes into operation from the date of actual service of the order and not from the date of issuance thereof. But in the instant case, this Court is compelled to take the view that the petitioner having obtained a copy of the said letter, promptly informed the Group General Manager and sent copies of this letter to the Chairman-cum-Managing Director by Annexure 3 i.e., letter dated 26.10.1999 wherein he informed them specifically about the existence of the said letter. The Respondents could very well have told him that such a letter did not exist, but instead of doing so, they merely informed by their letter dated 29.10.1999 that they were in receipt of his letter dated 26.10.1999 and that the application submitted by him is "yet to be released to him conveying acceptance of the Company". This was the extent of their reply. In that view of the matter, when the petitioner himself gave specific information about the letter dated 12.10.1999 and there being no denial by the respondents, it will be deemed that he was in receipt of the same and such receipt was obviously therefore prior to 31.10.1999. For the reasons stated therefore, the Respondents later on cannot be allowed to suddenly turn around and pass an order totally contrary to their earlier order of acceptance."
Learned Single Judge, therefore, held that the letter of acceptance dated 12.10.1999 attained finality and, therefore, the impugned letter informing the petitioner-respondent that his offer for voluntary retirement was not accepted is liable to be quashed.
6. Mr. R.S. Mazumdar, learned counsel appearing for the appellants, assailed the impugned judgment as being contrary to the facts and the law settled by the Supreme Court, Learned counsel submitted that when the petitioner-respondent's offer for voluntary retirement was not accepted then he joined the service and submitted an application that his absence may be treated as earned leave. Learned counsel further submitted that the letter of acceptance of voluntary retirement was never issued in favour of the petitioner-respondent rather such acceptance was subject to departmental and vigilance clearance. Learned counsel, in this regard, relied upon two decisions of the Supreme Court in the case of Md. U.P. Land Development Corporation and Anr. v. Amar Singh and Ors., (2003) 5 Supreme Court Cases 388, and also in the case Bank of India etc. and others, AIR 2003 SCW 313.
7. Learned counsel appearing for the petitioner-respondent, on the other hand, submitted that the impugned letter rejecting the application for voluntary retirement of the petitioner was illegal, arbitrary and without jurisdiction. Learned counsel submitted that no reason was assigned by the appellant-Company for rejecting the offer of the petitioner-respondent. Learned counsel further submitted that neither any departmental proceeding nor any vigilance inquiry was pending against the petitioner-respondent and he joined the services on protest and without prejudice to his right of voluntary retirement. Learned counsel relied upon two decisions of the Supreme Court in a case of Manjushree Pathak v. The Assam Industrial Development Corporation Ltd., and Ors., AIR 2000 SC 2769 and in the case of North Zone Cultural Central and Anr. v. Vedpathi Dinesh Kumar, (2003) 5 SCC 455.
8. Before appreciating the rival submissions made by the learned counsel, I would like to discuss the ratio decided by the Supreme Court in the decisions referred to here-in-above.
9. In the case of Manjushree Pathak v. The Assam Industrial Development Corporation Ltd., and Ors. reported, in AIR 2000 SC 2769 the facts of the case was that in 1992 the respondent-Corporation issued as a special measure in the form of a golden handshake proving an option to its employees for voluntary retirement. The appellant having served the respondent-Corporation for nearly 23 years made an application seeking voluntary retirement. The recommending authority on the same day recommended for accepting her voluntary retirement. Since the appellant was not allowed to hand over charge and there was none to take over charge from her and certain other official formalities were also left to be carried out, she was compelled to continue to attend to her duties. When there was no response from the respondent-Corporation, she wrote a letter to the Managing Director of the respondent-Corporation stating that the failure of the respondent-Corporation to accept her voluntary retirement has caused great inconvenience and that she was entitled to get her voluntary retirement accepted forthwith. In the said letter also she made it clear that in the absence of any specific order she would consider herself to be free person without any obligations to the respondent-Corporation. Further in the said letter she stated that in case there was any delay, she would presume that her voluntary retirement was deemed to have been accepted w.e.f. 15.2.1996 and that she would not attend her duties any more. Deciding the case. Their Lordships of the Supreme Court held :
"15. The Division Bench of the High Court has failed to see that the scheme conferred discretion on the Corporation under Clause 8.1 coupled with the duty to act judiciously when application for voluntary retirement was made by an employee. The said clause did not confer any unfettered discretion upon the Corporation to refuse the benefit of the scheme to any employee being an authority coming within the meaning of Article 12 of the Constitution. It was riot open to the Managing Director of the respondent-Corporation to act on extraneous consideration by issuing a show-cause notice dated 15/16.2.1996 so as to deprive the appellant of the benefit flowing from acceptance of her voluntary retirement. It is true that under Clause 8.1 of the Scheme discretion was available to the respondent-Corporation but that discretion was not absolute. It was circumscribed by the terms mentioned in the said clause and it was to be exercised judiciously. In the case on hand the Managing Director of the Corporation has failed to act reasonably and fairly. He abdicated his duty by not exercising discretion at all in the light of facts and circumstances of the case stated above in sufficient details.
16. We are of the view that the Division Bench of the High Court was also not right in saying that the appellant filed the writ petition even before any action was taken by the Managing Director of the respondent-Corporation either to accept or reject the application. It is clear from the undisputed facts that the appellant submitted the application in the prescribed form to accept her voluntary retirement from service with immediate effect; waited for sufficiently long time and wrote letters in January and February, 1996 pursuing the authority to accept the application seeking voluntary retirement. Further after receiving show-cause notice on 17.2.1996 from the respondent-Corporation, the appellant had no good reason to wait any longer. In this view it could not be said that the writ petition filed was premature."
10. In the case of North Zone Cultural Central and Anr. v. Vedpathi Dinesh Kumar reported in (2003) 5 Supreme Court Cases 455, the fact was that the respondent while serving as a temporary Accountant with the appellant Organization tendered his resignation on 18.11.1988 w.e.f. the same date. On 21.11.1988 he sent a telegram withdrawing that resignation. On 1.12.1988 he received a letter of 18.11.1988 from the appellant Organization stating that his resignation had been accepted on 18.11.1988 itself. A Single Judge of the High Court, although holding that the resignation was accepted on 18.11.1988, further held that the communication of the acceptance subsequent to withdrawal of the resignation by the respondent became redundant. It was further held that permitting the respondent to attend duty till 1.12.1988 also showed that the resignation had not taken effect and, therefore, it was held that respondent to be entitled to continuance in service with arrears of salary and allowances. The matter ultimately came to Supreme Court, Their Lordships observed :
"16. Therefore, it is clear that non-communication of the acceptance does not make the resignation inoperative provided there is in fact an acceptance before the withdrawal.
18. It is an admitted fact that so far as the appellant Organisation is concerned, there is no rule which requires the acceptance of the resignation to be communicated before the resignation could become effective. But the Division Bench in appeal has relied upon consolidated guidelines and instructions issued by the Government of India vide letter of 11.2.1988 dealing with the subject of acceptance and withdrawal of resignation. We see that these guidelines state that in the case of a resignation which has been accepted by the appointing authority with effect from a future date and if in the meantime the government servant concerned withdraws his resignation before he is actually relieved of his duties, the normal principle should be to allow the request of the government servant to withdraw the resignation. In these guidelines, we do not see any requirement which states that even in cases where the resignation is accepted with immediate effect, the same can be withdrawn before such acceptance is communicated to the government servant concerned. On the contrary, in our opinion, these guidelines also indicate that the resignation takes effect the moment the same is accepted."
Their Lordships further held :
"23. As noticed above, in the present case the resignation is dated 18.11.1988 and the same as found by us is accepted on 18.11.1988 itself. The communication was on 1.12.1988 about 13 days thereafter which delay, in our opinion, is not an undue delay so as to make us draw an inference that there has been no acceptance of the resignation. Even the fact that in the meantime the respondent either attended duty or signed the attendance register will be of no assistance to claim his resignation had not taken effect. Even otherwise the appellants have urged that because there was no responsible officer in the headquarters from 18.11.1988 after the respondent's resignation was accepted till 1.12.1988 and the respondent took advantage of the same and marked his attendance and such attendance cannot be treated as lawful attendance in view of the acceptance of his resignation on 18.11.1988. We agree with this contention of the appellant."
11. I would like it proper to take notice of some of the decisions of the Supreme Court on this subject.
12. In the case of Power Finance Corporation Limited v. Pramod Kumar Bhatia, 1997 (4) SCC 280, the fact of the case was that the respondent, while working in the appellant-Corporation applied for voluntary retirement and, by a proceeding dated 20.12.1994, the Corporation accepted his resignation subject to clearance of outstanding dues. The acceptance was to be given effect from 3.12.1994. By letter dated 6.1.1995 the respondent requested for deduction of certain amount out of outstanding dues and for issuing relieving order. In the meantime, realizing the mistake, the appellant Corporation withdrew the scheme of voluntary retirement. The matter came to the Delhi High Court and it was held that the order dated 20.12.1994 created vested right in the respondent and the same cannot be divested by subsequent order. The Supreme Court, reversing the judgment of the Delhi High Court, held as follows :
"Having regard to the respective contentions, the question that arises for consideration is whether the respondent acquired a vested right after acceptance of the voluntary retirement by proceedings dated 20.12.1994. It is seen that the order is a conditional order in that until the dues are paid, the order does not become effective. The respondent himself admitted that the outstanding dues could be adjusted from the amount payable to him. Admittedly, no such adjustment has been made. He, therefore, rightly understood that unless he is relieved of the duties of the post, after the payment of the outstanding dues, the order accepting his voluntary retirement does not become effective.
It is now settled legal position that unless the employee is relieved of the duty, after acceptance of the offer of voluntary retirement or resignation, jural relationship of the employee and the employer does not come to an end. Since the order accepting the voluntary retirement was a conditional one, the conditions ought to have been complied with. Before the conditions could be complied with the appellant withdrew the scheme. Consequently, the order accepting voluntary retirement did not become effective. Thereby no vested right has been created in favour of the respondent. The High Court, therefore, was not right in holding that the respondent has acquired a vested right and, therefore, the appellant has no right to withdraw the scheme subsequently".
13. In the case of Sambhu Murari Sinha v. Project and Development India and Anr., AIR 2000 SC 2473, the facts of the case was that in pursuance of a scheme for voluntary retirement, the appellant submitted an application dated 18.10.1997 seeking voluntary retirement. The offer was accepted by the respondent-management by their letter dated 30.7.1997. In the said letter of acceptance it was mentioned that the release memo along with detailed particulars would follow. Since it was specifically stated in that letter that the release memo along with detailed particulars would follow, the appellant continued in service till 26..9.1997 when he was relieved from the post in question. In the meantime the appellant had already submitted a letter to the respondents on 7.8.1997 followed by another letter dated 24.9.1997 withdrawing the letter dated 18.10.1995 by which he had sought voluntary retirement but this letter was not given effect to by the respondent-management. The appellant then filed a writ petition in the High Court which was dismissed by the Single Judge and the Division Bench also dismissed the appeal. The High Court did not accept the contention of the appellant that he, having withdrawn the letter of voluntary retirement, should be allowed to continue in service. Their Lordship of the Supreme Court, holding that even after acceptance, the application for voluntary retirement can be withdrawn before the effective date. Their Lordship observed as under :
"From the facts stated above, it would be seen that though the option of voluntary retirement exercised by the appellant by his letter dated 18.10.1995 was accepted by the respondent-management by their letter dated 30.7.1997, the appellant was hot relieved from service and he was allowed to continue in service till 26.9.1997, which, for all practical purposes, would be the "effective date" as it was on this date that he was relieved from service. In the meantime, as pointed out above, the appellant had already withdrawn the offer of voluntary retirement vide his letter dated 7.8.1997. The question which, therefore, arises in this appeal is whether it is open to a person having exercised option of voluntary retirement to withdrawn the said offer after its acceptance but before it is made effective. The question is squarely answered by the three decisions, namely, Balram Gupta v. Union of India, 1987 (Supp.) SCC 288, AIR 1987 SC 2345 : 1988 Lab IC 46; J.N. Srivastava v. Union of India, (1988) 9 SCC 559; 1988 AIR SCW 4057 : AIR 1999 SC 1571 and Power Finance Corporation Ltd. v. Pramod Kumar Bhatia, (1997) 4 SCC 280, in which it was held that the resignation, in spite of its acceptance, can be withdrawn before the effective date". That being so, the appeal is allowed. The impugned judgment of the High Court is set aside with the direction that the appellant shall be allowed to continue in service with all consequential benefits. There will, however, be no order as to costs".
14. In an another case of Sambhu Murari Sinha v. Project and Development India Limited and Anr., AIR 2002 SC 341 the Supreme Court reiterated its view that even after acceptance of voluntary retirement the jural relationship of employee and employer continued till the date of actual release of the employee. Their Lordship observed as under :
"Coming to the case in hand the letter of acceptance was a conditional one inasmuch as through option of the appellant for the voluntary retirement under the scheme was accepted but it was stated that the 'release memo along with detailed particulars would follow'. Before the appellant was actually released from the service, he withdraw his option for voluntary retirement by sending two letters dated August 07, 1997 and September 24, 1997, but there was no response from the respondents. By office memorandum dated 25th September, 1997 the appellant was released from the service and that too from the next day. It is not disputed that the appellant was paid his salaries etc till his date of actual release i.e., 26th September, 1997, and, therefore, the jural relationship of employee and employer between the appellant and the respondents did not come to an end on the date of acceptance of the voluntary retirement and said relationship continued till 26th of September, 1997. The appellant admittedly sent two letters withdrawing his voluntary retirement before his actual date of release from service. Therefore, in view of the settled position of the law and the terms of the letter of acceptance, the appellant had locus poenitentiae to withdraw his proposal for voluntary retirement before the relationship of employer and employee came to an end."
15. The petitioner has annexed a copy of circular of 1988 as annexure 18 to the supplementary affidavit filed in the writ application which was time to time extended Clause 3.1 of the said circular reads as under :
"3.1. An employee whose offer for voluntary retirement is accepted, will be entitled to the following terminal payments :
(a)....................................................
(b)....................................................
(c), (d)........................................................
(e)....................................................
(f).....................................................
Clause 4.2 of the Circular reads as under :
"The competent authority, however, will have the right not to grant voluntary retirement to any employee for reasons to be recorded in writing."
16. From the aforesaid clauses of the 1988 Circular, it is manifest that once an employee offers for voluntary retirement, it cannot be automatically accepted, rather, unless it is accepted by the employer in unequivocal terms, the employee cannot be automatically relieved with effect from a particular date.
17. The writ petitioner-respondent, in the instant case, offered for voluntary retirement on the printed format on 8.9.1999 with effect from 31.10.99 although a letter of acceptance was prepared by the appellant on 12.10.99 but it was never communicated or served upon the respondent writ petitioner. In the said letter of acceptance it was specifically mentioned that the respondent will retire from service of the Company with effect from 31.10.99 subject to vigilence and disciplinary clearance. The respondent unofficially procured a copy of the said letter and then requested the Company by letter dated 26.10.99 to release the above letter so that he could be relieved from service. It is, therefore, evident that even after procuring the aforesaid letter the respondent was waiting for the communication of acceptance of his voluntary retirement. The appellant-Company, in response to the letter of the respondent dated 26.10.99, informed him that his application for voluntary retirement is yet to be released The said letter dated 29.10.99 reads as under :
"HSCL/GGM/PS/VR/99/2864 29th October, 1999.
Shri B.K. Jha, Manager (PR) P.No. 4521 HSCL BS City.
Sub : Acceptance of VR.
Ref : Your letter dated 26.10.99.
We are in receipt of your letter on the subject mentioned above dated 26.10.99, The application submitted by you opting for VR is yet to be released to you conveying acceptance by the Company. There are impending matters required to be cleared before conveying the acceptance. While the Company is doing works necessary in this regard, you will be intimated about the acceptance of your voluntary retirement and date of release upon required clearance of the matter only.
Sd/ (A.P. Kastuar) Group General Manager."
18. The appellant further, by letter dated 2.11.99, reiterated that the respondent will not be released under Voluntary Retirement Scheme. The respondent was also informed that his absence from duty is unauthorized absence. The said letter of the appellant Company dated 2-11-99 reads as under :
No HSCL/GGM/PS/Pers/00/2560 Dated 2.111.99 Shri B.K. Jha, Manager (PR) P.No. 04521, HSCK/B.S.City Sub: Retirement under voluntary Retirement Scheme Ref : Your letter dated 1.11.99 Please refer to your letter mentioned above, with reference to the discussions on 23.10.99, 28.10.99 and 29.10.99 over phone and in person (in my office), this is once again confirmed that you were duly informed that you are not being released under Voluntary Retirement Scheme with effect from 31.10.99. Whatever you have mentioned in your letter referring to the discussion is totally distortion, baseless and fake for the designs and purpose which you seem to be building up in your letter. A letter was also issued to you in this regard but not only you were absent from your seat after signing the attendance register on 30.10.99 but also you refused to accept this letter upto 1.11.99. The question of your accepting the date of release does not arise because no such letter has been issued to you.
So far as you are not released from the Company from its services, your absence from duty is an unauthorized absence. Therefore, you are advised to join duty immediately."
19. Admittedly the respondent, thereafter, accepted his responsibility by Fax dated 8.11.99 and requested the Company to condone his absence and further requested the Company to allow him to avail earned leave till resumption of his duty. Ultimately the petitioner-respondent resumed his duty on 19.11.99 and, thereafter, after seven months the writ petition was filed seeking issuance of a writ directing the respondent-Company to pay the retiral benefits and other legal dues and to release him from service with effect from 31.10.99.
20. In the light of the aforesaid admitted facts I have no doubt in my mind in holding that the offer of voluntary retirement was never accepted and communicated to the respondent inasmuch as the draft letter of acceptance was a conditional one which was illegally procured by the petitioner-respondent. Admittedly the respondent was never relieved by the Company from service with effect from any date. On the contrary when the respondent realised that his offer for voluntary retirement was not accepted, he requested the Company to condone his absence and, thereafter resumed duty. In my view, therefore, jural relationship of employer and employee between the respondent and appellant never came to an end and it continued even after the effective date of retirement.
21. The learned Single Judge was, therefore, not correct in holding that the offer of the respondent shall be deemed to have been accepted. The learned Single Judge further erred in law in holding that the appellant-Company cannot be allowed to refuse the offer of voluntary retirement when a draft letter of acceptance was prepared although not communicated. The judgment of the learned Single Judge, therefore, cannot be sustained in law.
22. For the aforesaid reasons this appeal is allowed and the impugned judgment of the learned Single Judge is set aside. Consequently the writ petition is dismissed.