Rajasthan High Court - Jaipur
R.F.C. Officers Association vs R.F.C. And Ors. on 5 September, 1988
Equivalent citations: [1990(60)FLR286], (1991)ILLJ505RAJ
Author: Chief Justice
Bench: Chief Justice
JUDGMENT
1. The petitioner has filed this writ petition challenging the orders Annexure-7 dated July 22, 1987 and Annexure-II, dated December 12, 1987. On behalf of the employees in para No.7, averment has been made that the employers were continuously arid regularly without any interruption, paying ex-gratia to all the employees @ 20% of emoluments drawn by them for the last 15 years. This tact has also been mentioned in para No. 10 of the writ petition.
2. Reply has been filed by the employer Rajasthan Financial Corporation, non-petitioner No. 1, and it was submitted that the facts mentioned in paras No. 7 and 10 of the writ petition are admitted. They have also admitted that the Corporation used to pay ex-gratia payment of 20% of the emoluments to the officers/employees of the Corporation since 1973. The contention of the R.F.C. is that under the directions of the State Government, they have stopped the payment as they are bound by the directions given by the State Government, as a policy.
3. On behalf of the State Government, at the initial stage Shri. Dinesh Swami, Advocate General, was present in the Court for sometime. He left the Court and there was no one to represent the State Government. After dictation of this part of the order, Mr. L.K. Sharma appeared on behalf of Mr. Swami, and prayed that the case may be passed over or he may be allowed to make the submissions on behalf of Mr. Swami. Advocate General. This practice cannot be allowed and Mr. Sharma cannot be heard when we are dictating the order. Mr. Sharma further submits that there was a call from the other Bench, so Advocate General left this Court. It is the duty of the counsel atleast to inform the court that there is a call from the other Bench and he is leaving the court for sometime on account of call.
4. We have perused the reply filed by the State Government and in para No. 7, of the reply the State Government has stated that under the provisions of Payment of Bonus Act 1965, more particularly as mentioned in Section 32 of the said Act, bonus is not payable to the employees of the R.F.C. and in view of the exception provided under the Act of 1965, the petitioners have no right to claim or demand bonus in view of the fact that bonus is not admissible or payable to the employees of respondent No. 1, irrespective of any class or category. On behalf of the State Government, it was also submitted in reply filed that respondent No. 1, the R.F.C. was paying ex-gratia @ 20% of the emoluments drawn by the employees each year. The aforesaid payment being an ex-gratia does not create any right, statutory or otherwise, in the members of the petitioners Association to claim ex-gratia payment @ 20% of the salary. On behalf of the State Government it was also submitted that the aforesaid payment was a payment made ex-gratia which did not in any manner attract the provisions of Articles 14 and 16 of the Constitution of India. The State Government, has also submitted in reply that the ex-gratia payment is a separable part and can be separated with the emoluments which are paid. On behalf of the State Government, it was also submitted in the reply that the State of Rajasthan established and constituted a Bureau of Public Enterprises in Rajasthan to monitor/review and evaluate the functioning of all State Public Sector undertakings with a view to help the individual units to achieve their corporate objectives. On behalf of the State Government, the guidelines regarding payment of bonus ex-gratia to the public sector undertaking were produced.
5. On behalf of the employees of the R.F.C. it was submitted that ex-gratia payment is not a bonus. It was also submitted by Mr. Sharma that the payment is a condition of service and the part of the emoluments and they have tried to distinguish the payment of bonus and the ex-gratia payment. It was submitted by Mr. Sharma that bonus is provided under the Payment of Bonus Act, and it may vary from time to time. It is assessed on the profit, the working and other allied matters. It is a deferred payment of wages. According to Mr. Sharma, as far as ex-gratia payment is concerned, it has nothing to do with the bonus. Ex-gratia payment cannot be varied or reduced. As far this part of the argument is concerned, nothing has been said in the reply in a specific way.
6. We have perused the reply and heard the learned counsel appearing. We are sorry that we could not hear Advocate General and could not get the views of the Advocate General and the learned counsel appearing on behalf of the R.F.C. We are of the view that ex-gratia payment may not be a bonus and the payment made to the officers since 1973, is an integral part of the emoluments and the emoluments cannot be reduced by the Corporation under the directions of the State Government. It will not be out of place here to mention that the State Government is having limited powers of issuing a direction. Section 39(1) provides that the Board shall be guided by such instruction on question of policy as may be given to it by the State Government. Before giving the directions it is also mandatory to consult the development bank. In the rejoinder filed by the petitioner specifically they have mentioned that the development bank has not been consulted. Mr. Sharma further submits that on the last date of hearing, the Advocate General undertook before the Court to file an affidavit whether there was a consultation with the development bank or not. Mr. Advocate General, now present, submits that on last date of hearing of course he has stated that after consulting officer in-charge he will clarify the position regarding the points raised in rejoinder, but he could not reply as offices were closed. He submits that the correct copy was not supplied. It is not necessary for us to discuss the point as we are deciding it on altogether different point. Ex.P.12, notification inviting applications, was issued by the R.F.C. in the year 1960. In Ex.12 notification there is a specific mention that ex-gratia payment will be made to the employees of the Corporation @ 20% of the emoluments per-annum. This notification has created a right in the employees. Once they have issued an advertisement and mentioned that 20% ex-gratia payment will be paid and a person who applies so on the assurance given in the advertisement has a right to get the ex-gratia payment.
7. Section 39 of the R.F.C. Act, 1951 (Sic. State Financial Corporations Act, 1951) further provides that the Board shall be guided by such instructions on questions of policy as may be given to it by the State Government. The word or phrase ('policy') does not include the fixation of emoluments. The State Government has a limited power only in the matters pertaining the running of the business. To decide the fixation of the grades, creation of the posts and the matter relating to emoluments, pension, gratuity, etc. cannot be said to be a policy matter. If a wider interpretation is given to the word 'policy' as used in Section 39 the Corporation will become the part of the State Government and cannot work as autonomous body. We can understand that the matters relating to the advancement of loan and their recoveries and other allied matters the State Government, will have a right to give the directions under Section 39. The conditions of the service of the employees cannot be considered as a matter of policy. Therefore, we are of the view, that the directions given by the State Government, regarding ex-gratia payment are not within the jurisdiction of Government. The orders Annexure-7, dated July 22, 1987 and Annexure-11, are set-aside. We hereby further direct that the payment should be made to the employees which they are getting since 1973, and onwards. The Corporation shall comply with the order of this Court within 3 months. The State Government shall pay Rs. 1,000 as a cost of litigation to the petitioners.