Karnataka High Court
Mr. K. Srinivasa Iyer vs The Ministry Of Heavy Industries on 8 November, 2022
Author: S.G. Pandit
Bench: S.G. Pandit
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 8TH DAY OF NOVEMBER, 2022
BEFORE
THE HON' BLE MR. JUSTICE S.G. PANDIT
WRIT PETITION No.5091/2016 (S-RES)
BETWEEN:
1. MR. K. SRINIVASA IYER
S/O LATE S. KRISHNAMURTHY
AGED ABOUT 62 YEARS
RESIDING AT NO.4, F-102
SRI BALAJI RESIDENCY
DODDAPPAIAH LAYOUT
NAGASHETTYHALLI
SANJAYNAGAR
BANGALORE-560094.
2. MR.P.REVANNA
S/O LATE PUTTAREVAIAH
AGED ABOUT 63 YEARS
NO.271/12, 6TH A CROSS
8TH MAIN, RPC LAYOUT
HAMPINAGAR
BANGALORE-560104.
3. MR.V.SATHYANARAYANA
S/O LATE VEERAPPA
AGED ABOUT 62 YEARS
NO.378, 5TH MAIN
2ND BLOCK, BSK 1ST STAGE
BANALORE-560050.
4. G. CHANDRASHEKAR
S/O LATE P.A.GOVINDASWAMY
AGED ABOUT 62 YEARS
NO.409, 10TH CROSS, 3RD BLOCK
2
HMT LAYOUT, VIDYARANYAPURA
BANGALORE-560097.
5. R.ASWATHAIAH
S/O LATE RAMAIAH
AGED ABOUT 61 YEARS
NO.28, 1ST FLOOR, 7TH STREET
BANK AVENUE, BABUSAPALYA
KALYANANAGAR POST
BANGALORE-560043.
...PETITIONERS
(BY Ms. ANNU BHARADWAJ, ADV. FOR
SRI HARIKRISHNA S HOLLA, ADV.-THROUGH VC.
PETITION AGAINST PETITIONERS 4 AND 5 DISMISSED
V/O DATED 15.09.2020)
AND:
1. THE MINISTRY OF HEAVY INDUSTRIES
AND PUBLIC ENTERPRISES
DEPARTMENT OF PUBLIC ENTERPRISES
PUBLIC ENTERPRISES BHAWAN
BLOCK NO.14, CGO COMPLEX
LODI ROAD, NEW DELHI-110003
REPRESENTED BY ITS SECRETARY.
2. M/S. HMT (INTERNATIONAL) LTD.,
NO.59, BELLARY ROAD,
HMT BHAVAN 5TH FLOOR
BANGALORE-560032
REPRESENTED BY ITS MANAGING.
3. M/S. HMT LTD.,
NO.59, BELLARY ROAD,
HMT BHAVAN 5TH FLOOR
BANGALORE-560032
REPRESENTED BY ITS CHAIRMAN
AND MANAGING DIRECTOR.
...RESPONDENTS
(BY Ms.TEJASWINI B.R., ADV. FOR
M/S. KING & PARTIRIDGE, ADVS. FOR R1 TO R3)
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THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO
QUASH ORDER DATED 12.12.2013 VIDE ANNEX-D AND
OFFICE ORDER DATED 23.12.2013 VIDE ANNEX-E;
DIRECT THE RESPONDENTS TO EXTEND THE REVISION
OF PAY SCALE OF PETITIONERS IN PURSUANCE OF
MINISTRY'S NOTIFICATION DATED 26.11.2008 VIDE
ANNEX-B W.E.F. 01.01.2007 AND PAY THE ARREARS OF
SALARY AND TERMINAL BENEFITS W.E.F. 01.01.2007 DUE
THIS WRIT PETITION COMING ON FOR PRELIMINARY
HEARING IN 'B' GROUP THIS DAY, THE COURT MADE THE
FOLLOWING:-
ORDER
The petitioners are before this Court under Article 226 of the Constitution of India praying for a writ of certiorari to quash the order (Annexure-D) bearing No5- III(10)/2012-P.E.X dated 12.12.2013 and Office Order (Annexure-E) bearing No.10/13 dated 23.12.2013 and for a direction to extend the revision of pay scale to petitioners in pursuance to the Ministry's Notification (Annexure-B) bearing No.2(70)/D8-DPE (WC)-GL- XVI/DB dated 26.11.2008 w.e.f. 01.01.2007 and to pay the arrears of salary and terminal benefits w.e.f. 01.01.2007 due to the petitioners.
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2. Heard Ms. Annu Bharadwaj, learned counsel for Sri Hari Krishna S. Holla, learned counsel for the petitioner and Smt Tejaswini B.R. for M/s. King and Patridge, learned counsel for respondents 1 to 3. Perused the writ petition papers.
3. It is pointed out that insofar as the petitioners 4 and 5 are concerned, the writ petition is dismissed as withdrawn by order dated 15.09.2020. For the present, the writ petition insofar as petitioners 1 to 3 survive for consideration.
4. Learned counsel for the petitioners would submit that petitioners 1 to 3 were working in the 2nd respondent-M/s. HMT (International) Limited as Non- Unionized Supervisory Staff. Petitioners 1 to 3 retired from service on attaining the age of superannuation on 31.03.2011, 30.11.2010 and 30.04.2011 respectively. Ministry of Heavy Industries and Public Enterprises, Department of Public Enterprises under Official Memorandum (Annexure-B) dated 26.11.2008 provided 5 for revision of pay for Board and below Board level Executives. Learned counsel for the petitioners referring to clause 17 submits that the revised pay scale was given effect to from 01.01.2007 and the said Official Memorandum giving benefit of revision of pay was applicable to the petitioners. But the grievance of the petitioners is that the revised pay scale, in terms of Official Memorandum (Annexure-B) dated 26.11.2008 was not extended to the petitioners and similarly situated Non Unionized Supervisory Staff. Revision of pay benefit was given effect to only from 01.04.2012, but the petitioners, who retired prior to 01.04.2012 are denied of such benefit of revision of pay. Learned counsel would submit that under Annexure-F settlement between the workman and the management of the HMT the 2nd respondent herein, the revision of pay scales to the workman were granted and were given effect to from 01.01.2007. It is the submission of the learned counsel for the petitioners that the petitioners are treated with hostile discrimination. Further the 6 learned counsel would also submit that the benefit of revised pay scale is given effect to from 01.01.2007 in all other public undertakings except the respondent- HMT. Thus the learned counsel would submit that fixing the cut off date of 01.04.2012 is violative of Article 14 of the Constitution of India insofar as the petitioners are concerned. Thus the learned counsel would submit that action of the respondents in not extending the revised pay scales in terms of Official Memorandum (Annexure-B) dated 26.11.2008 from 01.01.2007 is arbitrary, unfair and unreasonable. Thus she prays for quashing Annexure-D dated 12.12.2013 and Annexure- E dated 23.12.2013, wherein decision is taken to give effect to the pay revision from 01.04.2012 and for a direction to the respondents to give effect to notification dated 26.11.2008 from 01.01.2007 and to grant all consequential benefits to the petitioners.
5. Per contra, Smt. Tejaswini B.R. learned counsel for respondents 1 to 3 submits that petitioners would not be entitled for the relief as prayed by them and as a 7 matter of right, they cannot seek for implementation of revision of pay from 01.01.2007. Learned counsel would point out to clause (3) of the Official Memorandum dated 26.11.2008 and submits that implementation of revised pay scales would depend on the affordability of the particular Organization, that too particularly, in respect of Executives and Non Unionized Supervisory Staff.
6. Learned counsel also would point out that the Ministry of Heavy Industries and Public Enterprises under Annexure-D taking note of the 2nd respondent- Company's financial position permitted implementation of revised pay scales from 01.04.2012. It is also pointed out that the pay revision was restricted only to the regular Executives and Non Unionized Supervisors of the Company, who were on the rolls of the Company as on 31.03.2012. The Central Government had made it clear that no budgetary support would be provided to HMT to meet the additional liability. Therefore, it is submitted that taking note of the financial position of 8 the respondent-Company as indicated in paragraph 9 of the statement of objections, revision of pay was implemented from 2011-2012 onwards.
7. Learned counsel for the respondents places reliance on the decision of the Hon'ble Apex Court in GOVERNMENT OF ANDHRA PRADESH AND OTHERS Vs. N. SUBBARAYUDU AND OTHERS reported in (2008) 14 SCC 702 and UNION OF INDIA AND OTHERS Vs. M.V. MOHANAN NAIR reported in (2020) 5 SCC 421 to contend that it is for the Executives to fix the cut off date keeping in view the economic conditions, financial constraints and many other administrative and attending circumstances. Thus she prays for dismissal of the writ petition.
8. Petitioners 1 to 3 were Non Unionized Supervisory Staff of the 2nd respondent-Company and they retired from service on attaining the age of superannuation on 31.03.2011, 30.11.2010 and 30.04.2011 respectively. The 1st respondent under Official Memorandum 9 (Annexure-B) dated 26.11.2008 brought in, revision of scales of pay of Board and below Board Level Executives w.e.f. 01.01.2007. It would be relevant to notice clauses 3 and 17 which reads as follows :-
"3. Affordability for implementation of pay revision: The revised pay scales would be adopted, subject to the condition that the additional outgo by such revision for a period of 12 months should not result in more than 20% dip in profit before tax (PBT) for the year 2007-08 of a CPSE in respect of executives as well as non-unionised supervisory staff taken together in a CPSE.
CPSEs that cannot afford to pay full package, can implement with either part PRP or no PRP. These CPSEs may pay the full package subsequently, provided the dip in the profit (PBT) is fully recouped to the original level.
17. Issue of Presidential Directive, effective date of implementation and payment of allowances etc. : The revised pay scales would be implemented by the issue of Presidential Directive in respect of 10 each CPSE separately by the concerned Administrative Ministry/ Department. The revised pay scales will be effective from 1.1.2007. The payment of HRA, perks and allowances based on the revised scales will, however, be from the date of issue of Presidential Directive. The Board of Directors of each CPSE would be required to consider the proposal of pay revision based on their affordability to pay and submit the same to the Administrative Ministry/ Department for approval. The concerned Administrative Ministry with the concurrence of its Financial Advisor will issue the Presidential Directive. A Copy of the Presidential Directive issued to the CPSEs concerned may be endorsed to the Department of Public Enterprises."
A reading of Clause (3) above makes it abundantly clear that revised pay scales could be adopted subject to the condition of affordability for implementation of pay revision. Clause (17) above makes it clear that the revised pay scales would be effective from 01.01.2007. If the respondent-Company adopts pay revision in its 11 entirety, then the 3rd respondent has to give effect to the revision of pay from 01.01.2007. But in the case on hand, in respect of 2nd respondent-Company taking note of the financial position of the Company, the 1st respondent by its letter (Annexure-D) dated 12.12.2013 permitted implementation of the revised pay scales for Board level and below Board level Executives and Non Unionized Supervisors w.e.f. 01.04.2012 and it also made it clear that the pay revision would be to the regular Executives and Non Unionized Supervisors of the Company, who were on the rolls of the Company as on 31.03.2012. Admittedly the petitioners were not on the rolls of the Company as on 31.03.2012, as the petitioners had retired in the year 2010 and 2011. Paragraph 10 of the statement of objections of respondents 1 to 3 provides particulars of the Company's performance from the year 2007-2008 to 2012-2013 which is extracted below:
"10. As per the audited statement of the accounts, the Company's performance was as follows :12
[ value Rs. Lakh ] Sl Operational 2007- 2008- 2009 2010 2011 2012-
No. parameters 08 09 -10 -11 -12 13
1 Sales 2500 1636 3080 2788 3240 2561
2 PBT- before EOI 102 126 396 360 457 642
3 Extra-ordinary - - - 329 283 -
item (EOI) 1997
revision arrears
4 Net Profit- PBT 102 126 396 31 174 642
(after EOI)
5 DPE Guidelines 20.40 25.20 79.20 6.20 34.80 128.40
from
implementation
of 2007 scale-
20% of profit
6 Burden 41.97 48.45 59.17 75.30 98.00 114.03
consequent to
implementation
of 2007 pay scale
7 Applicability for - - - - Eligible Eligible
implementation
as per DPE
guideline
A reading of the above table makes it clear that during the financial years 2011-12 and 2012-13, the Company earned profit and taking note of the same, the Company decided to implement the pay revision from 01.04.2012, which cannot be faulted.13
9. Learned counsel for the petitioners contended that the petitioners are discriminated in the matter of extension of 2007 pay revision. There is no merit in the said contention for the reason that the Official Memorandum (Annexure-B) dated 26.11.2008 wherein the 1st respondent introduced the revision of pay scale, makes it clear that adoption of revision of pay would depend on the affordability for implementation, and the other reason would be that fixing the cut off date is better left to the management, since it depends on its economic conditions, financial constraints and many other administration and other attending circumstances. Learned counsel also submitted that the pay revision as introduced under Official Memorandum (Annexure-B) dated 26.11.2008 was implemented as it is in the other organizations such as HAL and BEL. As stated earlier, the adoption of pay revision would depend on the affordability of each Company, since those Companies were in a position to afford the pay revision, they must have given effect to 14 the revision of pay from 01.01.2007. Whereas from a reading of the statement of objections it is clear that the 2nd respondent-Company was not in position to afford to give effect to revision of pay from 01.01.2007 because of its financial condition.
10. The Hon'ble Apex Court in the case of GOVERNMENT OF ANDHRA PRADESH AND OTHERS supra with regard to fixing the cut off date for implementation of fixation of pay at paragraphs 5, 7 and 8 has held as follows :-
"5. In a catena of decisions of this Court it has been held that the cut-off date is fixed by the executive authority keeping in view the economic conditions, financial constraints and many other administrative and other attending circumstances. This Court is also of the view that fixing cut-off dates is within the domain of the executive authority and the court should not normally interfere with the fixation of cut-off date by the executive authority unless such order appears to be on the face of it blatantly 15 discriminatory and arbitrary. (See State of Punjab Vs. Amar Nath Goyal).
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7. There may be various considerations in the mind of the executive authorities due to which a particular cut-off date has been fixed. These considerations can be financial, administrative or other considerations. The court must exercise judicial restraint and must ordinarily leave it to the executive authorities to fix the cut-off date. The Government must be left with some leeway and free play at the joints in this connection.
8. In fact several decisions of this Court have gone to the extent of saying that the choice of a cut-off date cannot be dubbed as arbitrary even if no particular reason is given for the same in the counter-affidavit filed by the Government (unless it is shown to be totally capricious or whimsical), vide State of Bihar v. Ramjee Prasad, Union of India v.
Sudhir Kumar Jaiswal 1994(4) (vide SCC para 5), Ramrao v. All India Backward Class Bank Employees Welfare Assn. (vide SCC para 31), University Grants Commission v. Sadhana Chaudhary, etc. It follows, 16 therefore, that even if no reason has been given in the counter-affidavit of the Government or the executive authority as to why a particular cut-off date has been chosen, the court must still not declare that date to be arbitrary and violative of Article 14 unless the said-cut off date leads to some blatantly capricious or outrageous result."
11. In the decision in UNION OF INDIA AND OTHERS supra, again in the matter of fixation of pay the Hon'ble Apex Court at paragraphs 37 and 38 has held as follows :-
37. Observing that fixation of pay and determination of responsibilities is a complex matter which is for the executive to take a decision, the Courts should approach such matters with restraint, in State of Haryana v.
Haryana Civil Secretariat Personal Staff Assn, the Supreme Court held as under
(SCC pp. 79-80, para 10):-
"10. It is to be kept in mind that the claim of equal pay for equal work is not a fundamental right vested in any employee 17 though it is a constitutional goal to be achieved by the Government. Fixation of pay and determination of parity in duties and responsibilities is a complex matter which is for the executive to discharge. While taking a decision in the matter, several relevant factors, some of which have been noted by this Court in the decided case, are to be considered keeping in view the prevailing financial position and capacity of the State Government to bear the additional liability of a revised scale of pay......... That is not to say that the matter is not justiciable or that the courts cannot entertain any proceeding against such administrative decision taken by the Government. The courts should approach such matters with restraint and interfere only when they are satisfied that the decision of the Government is patently irrational, unjust and prejudicial to a section of employees and the Government while taking the decision has ignored factors which are material and relevant for a decision in the matter. Even in a case where the Court holds the order passed by the Government to be unsustainable then ordinarily a direction should be given to the State Government or the authority taking the 18 decision to reconsider the matter and pass a proper order. The Court should avoid giving a declaration granting a particular scale of pay and compelling the Government to implement the same......". [emphasis supplied]
38. The prescription of pay scales and incentives are matters where decision is taken by the Government based upon the recommendation of the expert bodies like the Pay Commission and several relevant factors including financial implication and court cannot substitute its views. As held in Haryana Civil Secretariat Personal Staff Assn., the Court should approach such matters with restraint and interfere only when the Court is satisfied that the decision of the Government is arbitrary. Even in a case where the Court takes the view that order/scheme passed by the Government is not an equitable one, ordinarily only a direction could be given to the State Government or the authority for consideration of the matter and take a decision. In the present batch of cases where the respondents are claiming financial upgradation in the grade pay of promotional 19 hierarchy, no grounds are made out to show that the MACP Scheme granting financial upgradation in the next grade pay is arbitrary and unjust; warranting interference. The implementation of the MACP Scheme is claimed to have led to certain anomalies; but as pointed out earlier, MACP Scheme itself is not under challenge."
The Hon'ble Apex Court has made it clear that the Court must ordinarily leave it to the executive authorities to fix the cut off date and cut off date cannot be dubbed as arbitrary even if no particular reason is given for the same.
12. For the reasons recorded above and following the principles laid down by the Hon'ble Apex Court in the above decisions, I am of the view, that there is no error or illegality in giving effect to the pay revision from 01.04.2012 by the respondents 2 and 3.
Accordingly the writ petition stands rejected.
Sd/-
JUDGE NG* CT:bms