Madhya Pradesh High Court
Chief Engineer vs Smt. Shilpa Laghate on 26 November, 2015
Author: Sanjay Yadav
Bench: A.M. Khanwilkar, Sanjay Yadav
:: 1 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP
No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15,
14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15
HIGH COURT OF MADHYA PRADESH : JABALPUR
W.P. Nos.2315/2015 (S), 2544/2015, 13958/2015,
13959/2015, 13961/2015, 13963/2015, 13965/2015,
13969/2015, 13973/2015, 13976/2015, 13977/2015,
13978/2015, 13981/2015, 13982/2015, 13983/2015,
RP No. 554/2015, W.P. Nos.13995/2015, 13997/2015,
13998/2015, 14001/2015, 14003/2015, 14005/2015,
14006/2015, 14007/2015, 14009/2015, 14011/2015,
14012/2015, 14014/2015, 14019/2015, 14021/2015,
14024/2015, 14025/2015, 14028/2015, 14029/2015,
14032/2015, 14035/2015, 14036/2015, 14554/2015,
17404/2015, 17405/2015 and W.P. No.17407/2015
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CORAM :
Hon'ble Shri Justice A.M. Khanwilkar, Chief Justice
Hon'ble Shri Justice Sanjay Yadav, J.
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Shri Arvind Kumar Shrivastava, Advocate for the
petitioner in W.P. No.2315/2015(S).
Shri Akash Choudhury, Advocate for the petitioner in W.P.
No.2544/2015.
Shri Ravi Jain, Advocate for the petitioners in W.P.
No.13958/2015, 13951/2015, 13961/2015, 13963/2015,
:: 2 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP
No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15,
14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15
13965/2015, 13969/2015, 13973/2015, 13976/2015,
13977/2015, 13978/2015, 13981/2015, 13982/2015,
13983/2015, RP No.554/2015, 13997/2015, 13998/2015,
14001/2015, 14003/2015, 14005/2015, 14006/2015,
14007/2015, 14009/2015, 14011/2015, 14012/2015,
14014/2015, 14019/2015, 14021/2015, 14024/2015,
14028/2015, 14029/2015, 14032/2015, 14035/2015 and
14036/2015.
Shri Prashant Sharma, Advocate for the petitioner in W.P.
No.14554/2015 and for respondent No.1 in W.P.
Nos.13965/2015, 13973/2015, 13976/2015, 14001/2015.
Shri A.A. Barnad, Government Advocate for the
respondent-State.
Shri Sanjay Agarwal, Advocate for the respondent No.4 in
W.P. No.2315/2015 and respondent No.8 in W.P. No.2544/2015.
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Reserved on : 28.10.2015
Date of decision : 26.11.2015
ORDER
Per Sanjay Yadav, J.
In these batch of writ petitions, we are mainly concerned with two notifications issued by the State of Madhya Pradesh through its Department of Labour, viz. Notification No.195- :: 3 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 2014-,-16 dated 27.5.2014 published in Madhya Pradesh (Asadharan) Rajpatra dated 6.6.2014 and Notification No.1A- 06-14-B-16 dated 10.12.2014 published in Madhya Pradesh Rajpatra dated 19.12.2014 in purported exercise of the powers conferred by Section 5 of the Payment of Gratuity Act, 1972 (hereinafter referred to as '1972 Act'), which empowers the appropriate Government to exempt - any establishment, factory, mine, oilfield, plantation, port, railway company or shop; - any employee or class of employees employed in these establishment(s) from the operation of provisions of 1972 Act, if, in its opinion, these employees or class of employees employed in these establishment(s) are in receipt of gratuity or pensionary benefits not less favourable than the benefits conferred under the 1972 Act.
2. The establishments, which we are concerned with, are the corporate entities brought in vogue vide Notification No.3679-,Q-vkj-,l-18-rsjg-2002 published in Madhya Pradesh Rajpatri (Asadharan) dated 31.5.2005; whereby, in exercise of the powers conferred under Madhya Pradesh Vidyut Sudhar Adhiniyam, 2000; the Electricity Act, 2003 and Madhya Pradesh Electricity Reforms First Transfer Scheme Rules, 2003, the State :: 4 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 Government restructured existing Madhya Pradesh State Electricity Board (earlier constituted under Section 58(4)(a) of Madhya Pradesh Reorganisation Act, 2000 by dissolving the then existing Madhya Pradesh Electricity Board which was constituted under the Indian Electricity (Supply) Act, 1948) into different corporate entities viz. Generating Company known as Madhya Pradesh Power Generating Company Limited, Transmission Company known as Madhya Pradesh Power Transmission Company Limited and three distribution companies viz. Madhya Pradesh Poorva Kshetra Vidyut Vitran Company Limited, Madhya Pradesh Madhya Kshetra Vidyut Vitran Company Limited and Madhya Pradesh Pashchim Kshetra Vidyut Vitran Company Limited. And, as evident from the Notification dated 31.5.2005, the restructuring of erstwhile Madhya Pradesh State Electricity Board is with effect from 1.6.2005. No such notification has been commended at to establish that any of these company owe an existence prior to 1.6.2005 (the relevancy of this observation will have the bearing when we will be dealing with the issues which are raised, at relevant stage).
3. That, prior to coming into existence of these five :: 5 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 corporate entities, the establishments viz. Madhya Pradesh Electricity Board and Madhya Pradesh State Electricity Board had adopted Madhya Pradesh Civil Services (Pension) Rules, 1976. This fact would be evident from the contentions in paragraph 16 and 17 of the return filed by the respondents no.2 to 7 in Writ Petition No.573/2015 and adopted in Writ Petition No.2544/2015; wherein, it is stated that Madhya Pradesh Electricity Board in exercise of power conferred by clause (c) of Section 79 of the Electricity (Supply) Act, 1948 vide notification dated 19.10.1963 made applicable New Pension Rules, 1951 and vide notification dated 3.4.1978 applied the Madhya Pradesh Civil Services (Pension) Rules, 1976 w.e.f. 1.6.1976 to its employees. And, vide said notification (i.e. 3.4.1978) also applied the Madhya Pradesh Civil Pension (Commutation) Rules, 1976 w.e.f. 1.1.1976.
4. In the past, the employees of erstwhile Board claiming that the gratuity payable under the 1976 Rules being less favourable had availed the remedy under the Payment of Gratuity Act, 1972, as by virtue of Section 14 thereof, the provisions therein were having overriding effect 'notwithstanding anything inconsistent therewith contained in :: 6 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 any enactment other than this Act or in any instrument or contract having effect by virtue of any enactment other than this Act'.
5. Pertinent it is, at this stage, to take note of sub-rules (8), (9), (10), (11) and (12) of Rule 7 of Madhya Pradesh Electricity Reforms First Transfer Scheme Rules, 2003. These sub-rules mandate that the service benefits including terminal benefits shall not in any way be inferior to those applicable immediately before the transfer, stipulating therein that :
"8. Subject to the provisions of the Act and these Scheme Rules, the transferee shall be entitled to modify or frame new regulations governing the conditions of service of personnel transferred to the transferee under these Scheme Rules, but their rank, scale of pay, salary, allowances and other pecuniary benefits including terminal benefits etc., after the effective date of transfer shall not in any way be inferior to those appliacable to them immediately before the transfer.
9. In respect of all statutory and other schemes, employment related matter including the provident fund, gratuity fund, pension and any other superannuation fund or any other special fund created or existing for the benefit of the personnel, :: 7 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 the relevant transferee shall stand substituted for the Board for all purposes and all the rights, powers and obligations of the Board in relation to any and all such matters shall become those of the transferee concerned and the services of the personnel shall be treated as having been continuous for the purpose of the application of these Scheme Rules.
10. The State Government shall notify appropriate arrangements in regard to the funding of the pension funds and other personnel related funds by the transferees to the extent they are not funded on the date of the transfer of the Personnel from the Board including for the due payment of the amounts to personnel who retire after the date of the transfer, by the respective transferees to which there personnel are transferred and till such time such payments shall be duly made by the Board.
11. The State Government shall notify appropriate arrangements in regard to the funding and due payment of the terminal benefits to the existing pensioners of the Board as on the date of the transfer and till such time such payments shall be duly made by the Board.
For the purpose of this sub-clause, the term,-
:: 8 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15
(i) "Existing Pensioner" means all the persons eligible for the pension as on the date of the transfer from the Board and shall include family members of the personnel, and,
(ii)"Terminal Benefits" means the gratuity, pension, dearness and other applicable relief, medical benefit, and other applicable benefits including the right to have the appropriate revisions in the above benefits consistent with the practice that wre prevalent in the Board.
(12) The provisions of sub-rules (9), (10), and (11) above shall not apply to any personnel, other than the existing personnel and existing pensioner of the Board, as on the date of transfer. All personnel recruited and appointed by the transferee shall be governed by, Contributory Provident Fund Scheme or any other appropriate scheme, which the transferee concerned may establish for the purpose and not by the pension schemes of the existing personnel and existing pensioners, under sub-rules (9), (10) and (11) above."
6. Erstwhile employees i.e. "existing pensioners" having succeeded in determination of gratuity as per 1972 Act, under the said Act; wherein orders were passed by the Controlling Authority for determination and payment of gratuity computed :: 9 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 as per Section 4 of 1972 Act. These orders came to be affirmed in Appeal and in Writ Petitions. In one such Writ Petition No.5618/2007(s) : Chief Engineer, MPSEB Gwalior vs Radheyshyam Goyal, a Division Bench of this Court by order- dated 19.11.2008 while upholding the claim of the employees, held -
"5. After having heard at length to the counsel for the parties and going through the orders passed by the Controlling Authority as well as by the Appellate Authority, we are of the opinion that there is no merit in the petition. Section 14 of the Payment of Gratuity Act, 1972 overrides the provisions of other enactments. Under sub-section (5) of Section 4 of the Act, there is a right available to the employee to opt for better terms of gratuity.
Employee has right to choose the gratuity under the provision which is more beneficial. The Payment of Gratuity is more beneficial under the Gratuity Act has been concurrently found on facts. Thus, in our opinion, the orders passed by the Controlling Authority and the Appellate Authority are proper.
6. The petitioner counsel was unable to point out any provision in pension rules that in case gratuity is availed under the Payment of Gratuity Act benefit of pension would be available. The petitioner's counsel has relied on DTC Retired Employees' Association (supra); it was a case with regard to the applicability of the Pension Scheme and applicability of Provident Fund Scheme. In that :: 10 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 pension scheme was required to be accepted using the option within the specified time which is not the case of the petitioner. Counsel for the petitioner further relied on EID Parry (I) Ltd. (supra) in which the provision of A.P. Shops and Establishment Act, 1996 was found to be more beneficial as compared to the Payment of Gratuity Act, 1972. Here, position is contrary."
7. These decisions led these five corporate entities move the State Government vide their letter No.15801 dated 7.3.2014, seeking exemption under Section 5 from the provisions of 1972 Act. The relevant note-sheet contained in File No.195/2014/ l- 16 of Labour Department brought on record of Writ Petition No.2315/2015 reveals that the Labour Commissioner, whose opinion was sought, negatived the claim for exemption from applicability of 1972 Act to these establishments. Pertinently, the exemption was being sought only in respect of the employees belonging to erstwhile Board. Later on, a decision was taken on 23.5.2014 of issuing exemption notification prospectively, in the following terms :
fo"k;%& fo|qr daifu;ksa dks miknku Hkqxrku vf/kfu;e] 1972 ¼The Payment of Gratuity Act, 1972½ dh /kkjk&05 ds varxZr NwV ds lac/a k esa ¼e/;izns'k e/;{ks= fo|qr forj.k daiuh fyfeVsM] Hkksiky½ :: 11 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 ;g ewy uLrh e/;izns'k e/;{ks= fon~;qr forj.k dEiuh fyfeVsM] Hkksiky dks miknku Hkqxrku vf/kfu;e 1972 dh /kkjk 05 ds vUrxZr NwV iznku djus ls lacaf/kr gSA bl ewy uLrh ds lkFk&lkFk ikWp vU; fon~;qr forj.k dEifu;kW 1&e/;izns'k ikWoj Vªkalfe'ku dEiuh fyfeVsM] tcyiqj 2& e/;izns'k ikWoj esustesUV dEiuh fyfeVsM] tcyiqj 3& ,e0ih0 ikWoj esustesaUV dEiuh fyfeVsM] tcyiqj 4& e0iz- iwoZ {ks= fon~;qr forj.k dEiuh fyfeVsM] tcyiqj 5&e0iz0if'pe {ks= fon~;qr forj.k dEiuh fyfeVsM] tcyiqj dh ufLr;kW Hkh v/kksfLFkr gSaS bu lHkh dEifu;ksa ds }kjk miknku Hkqxrku vf/kfu;e] 1972 dh /kkjk 05 ds vUrxZr NwV pkgh xbZ gSA bl ekeys esa fofHkUu deZpkjh laxBuksa ,oa dEifu;ksa ds izfrfuf/k;ksa ds lkFk fnukad 4&4&14 dks cSBd j[kh xbZ o mHk;i{kksa dks i;kZIr volj nsrs gq, lquk x;k A 2- izca/ku ds izfrfuf/k;ksa ds }kjk ,oa laxBu ds izfrfuf/k;ksa ds }kjk tks rF; izLrqr fd;s x;s mudk lekos'k izLrqr la{ksfidk esa fd;k x;kA la{ksfidk dh izfr v/kksfLFkr gS A 3- miknku Hkqxrku vf/kfu;e 1972 dh /kkjk 05 ds vUrxZr NwV u feyus ds dkj.k bu lHkh dEifu;ksa dks gtkjksa U;k;ky;hu izdj.kksa esa my>uk iM+ jgk gS o dEifu;ksa ij foRrh; Hkkj vk jgk gS tks turk ls olwy gksxk vr% O;kid tufgr esa mDr lHkh dEifu;ksa dks Hkfo";y{kh ¼vf/klwpuk fnukad ls miknku Hkqxrku vf/kfu;e 1972 dh /kkjk 05 ds vUrxZr NwV½ fn;k tkuk izLrkfor gS D;ksafd lHkh ekeys ,d tSls gSaA bl izdj.k esa fy;s x;s :: 12 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 fu.kZ; vU; ikaWpksa izdj.kksa esa Hkh ykxw gksaxsA izLrko vuqeksnu gsrq izLrqr gS A **
8. With the acceptance of proposal, the appropriate Government i.e. State Government issued notification on 27.5.2014 in the following terms :
**Ø-195&2014&,&16&miknku Hkqxrku vf/kfu;e] 1972 ¼Ø-
1972 dk 39½ dh /kkjk 5 esa iznRr 'kfDr;ksa dks iz;ksx esa ykrs gq, jkT; 'kklu] ,rn~}kjk e/;izns'k ikWoj esustesaV dEiuh fy-] tcyiqj] e/;izns'k ikWoj tujsfVax dEiuh fy-] tcyiqj e/;izns'k ikWoj Vªkaleh'ku dEiuh fy-] tcyiqj e/;izns'k e/; {ks= fo|qr forj.k dEiuh fy-] Hkksiky e/;izns'k iwoZ {ks= fo|qr forj.k dEiuh fy-] tcyiqj rFkk e/;izns'k if'pe {ks= fo|qr forj.k dEiuh fy-] bUnkSj esa fu;ksftr fu;fer dkfeZdksa dks ftUgsa e/;izns'k flfoy lsok ¼isa'ku½ fu;e] 1976 xzkg~; dj miknku] is'a ku] isa'ku dE;wV's ku rFkk e`R;q lg&miknku ds leLr ykHk iznku djus vkSj dkfeZdksa dks miknku ,oa csgrj isa'ku dk Hkqxrku ldy :i ls fd;s tkus ds dkj.k mUgsa miknku Hkqxrku vf/kfu;e] 1972 ds izHkkoh gksus ls vf/klwpuk tkjh djus dh fnukad ls NwV iznku djrh gSA**
9. After issuance of exemption notification on 27.5.2014, these companies sought further indulgence of the State Government seeking exemption from a retrospective date on :: 13 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 the contentions that in the past, the employees were in the receipt of gratuity and terminal benefits not less favourable than the benefits conferred under 1972 Act. And, that if the exemption is not granted from retrospective date, there will be additional financial burden of Rs.90 crores. The claim paved the way for following proposal -
**iwoZ esa Je foHkkx dh vf/klwpuk fnukad 27&5&2014 ls e/;izns'k fon~;qr e.My dh fofHkUu dEifu;ksa dks miknku Hkqxrku vf/kfu;e] 1972 ds izko/kkuksa esa NwV nh xbZ FkhA pwaWfd buds }kjk Hkqxrku dh tk jgh lqfo/kk miknku vf/kfu;e esa fn;s x;s izko/kkuksa ls vf/kd csgrj FkhA fon~;qr e.My dh fofHkUu dEifu;ksa us Hkwry{kh izHkko ls NwV ekaxh gSA vr% e/; izns'k ikoj tujsfVax dEiuh fyfeVsM] tcyiqj] e/;izns'k e/; {ks= fon~;qr forj.k dEiuh fyfeVsM] Hkksiky] e/;izns'k if'pe {ks= fon~;qr forj.k dEiuh fyfeVsM] bUnkSj dks 31&05&2005 o ,e-ih- ikoj eSustesVa dEiuh fyfeVsM] tcyiqj dks 31&05&2006 rFkk e-iz-ikoj Vªkalfe'ku dEiuh fyfeVsM] tcyiqj dks 16&09&1972 ls NwV fn;k tkuk izLrkfor gSA iwoZorhZ e/;izns'k fon~;qr e.My dh fofHkUu ns;rk,Wa e/;izns'k ikoj Vªkalfe'ku dEiuh tcyiqj dks nh xbZ gSaA vr% ,DV ykxw gksus ds le; ls bl dEiuh dks NwV fn;k tkuk izLrkfor gSA 2- ;g mfYyf[kr gS fd ;fn iwoZ esa dEifu;kW U;k;ky;hu vkns'kksa ;k fdlh vU; dkj.k ls ;fn dksbZ xzsT;qVh dk Hkqxrku lsokfuo`Rr dfeZ;ksa dks fn;k x;k gS rks :: 14 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 mldh olwyh ;g dEifu;kW ugha dj ldsaxhA ;g izko/kku o la'kks/ku vf/klwpuk esa tkjh fd;k tkuk izLrkfor gS] ftlls dh lsokfuo`Rr dfeZ;ksa ds fgrksa dh j{kk gks ldsA mijksDrkuqlkj vuqeksnu gsrq A **
10. This proposal led to issuance of Notification on 10.12.2014, which is in the following terms -
Ø- ,Q1 ¼,&06&14&c&lksyg&miknku Hkqxrku vf/kfu;e] 1972 ¼Ø- 1972 dk 39½ dh /kkjk 5 esa iznRr 'kfDr;ksa dk iz;ksx esa ykrs gq, jkT; 'kklu] ,rn~}kjk] bl foHkkx dh vf/klwpuk Ø- ,Q 195&2014&,&lksyg] fnukad 27 ebZ 2014 tks e/;izns'k ¼vlk/kkj.k½ jkti= esa fnukad 06 twu] 2014 dks izdkf'kr gS] esa la'kks/ku djrs gq, fuEu dEifu;ksa dks muds }kjk Hkwry{kh izHkko ls NwV nsus ds laca/k esa izLrqr vH;kosnu ij iqufoZpkj djrs gq, dEifu;ksa ds le{k mYysf[kr frfFk ls NwV iznku djrh gS%& Ø- daiuh dk uke NwV iznku dh fof/k ¼1½ ¼2½ ¼3½ 1- e/;izns'k ikWoj tujsfVax dEiuh fyfeVsM] tcyiqj 31&5&2005 2- e/;izns'k iwoZ {ks= fo|qr~ forj.k dEiuh fy-] tcyiqj 31&5&2005 3- e/;izns'k e/; {ks= fo|qr dEiuh fy-] Hkksiky 31&5&2005 4- e/;izns'k if'pe {ks= fo|qr dEiuh fy-] bankSj 31&5&2005 5- e/;izns'k ikWoj esustesaV dEiuh fy-] tcyiqj 31&5&2006 6- e/;izns'k ikWoj Vªkalfe'ku dEiuh fy-] tcyiqj 16&9&1972 ijUrq ;g fd iwoZ esa mDr dEifu;ka] U;k;ky;hu vkns'kksa ;k fdlh vU; dkj.k ls ;fn dksbZ xzsP;qVh dk Hkqxrku lsokfuo`Rr dfeZ;ksa dks fn;k x;k gS] rks mldh olwyh ;s dEifu;ka ugha dj ldsaxhA** :: 15 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15
11. That, learned single Judge, Gwalior Bench of this Court in seisin with batch of writ petitions preferred by these corporate entities against the order passed by Authorities under 1972 Act wherein these notifications i.e. notification dated 27.5.2014 and 10.12.2014 were pressed in service and though such challenge being negatived by order dated 14.3.2014 in a batch of Writ Petition Nos.8918/2013, 8929/2013, 8849/2013, 2871/2013, 3109/2013, 3718/2013, 3719/2013, 3723/2013, 4513/2013, 7770/2013, 7771/2013, 7772/2013, 8217/2013, 8374/2013, 215/2014, 214/2014, 213/2014, 250/2014, 1396/2014, 8375/2013, 8377/2013, 8552/2013, 8553/2013, 8772/2013, 8908/2013, 8910/2013 in Writ Petition No.14554/2015 yet, taking note of the fact that constitutional validity of the notification dated 10.12.2014 being under challenge in Writ Petition No.573/2015 (re-registered as W.P. No.14554/2015 at Jabalpur) : M.P. Vidyut Karamchari Pensioners' Association vs State of M.P and forming an opinion that the matter involves substantial question of law of general importance, has referred the matter for decision by larger Bench by formulating the question :
"whether the notification dated 10.12.2014 :: 16 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 will nullify or take away the effect and benefit of the orders passed by the Controlling and Appellate Authority under the Gratuity Act ?".
12. The question referred though is confined only to the aspect as to whether an order passed by quasi-judicial authority of conferring certain service benefits under 1972 Act could be retrospectively taken away. In other words, whether such a quasi-judicial pronouncement tantamount to accrual of right in favour of such employees or class of employees and the right so accrued can be taken away by effecting an exemption from 1972 Act from retrospective date. And, whether the choice of date can be beyond the date from which the corporate entity has come into existence.
13. The answer could have been short had the question referred was the only issue, the reason being that, though all these five corporate entities were reconstituted and restructured with effect from 1.6.2005 yet, in TRANSCO, the exemption has been made effective from 16.9.1972 i.e. from the date when Act of 1972 came into existence. Whether this could be done was the only issue. But, it is not to be so because alongwith these batch of Writ Petitions is also a Writ :: 17 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 Petition (W.P. No.14554/2015) wherein the vires of notification dated 10.12.2014 is being questioned. Therefore, we intend to deal with the issue of vires also by this order.
14. We straightaway go to the aspect of vires.
15. The contentions on behalf of petitioners to the validity of notification is that it is beyond the powers of the appropriate Government to review the notification earlier issued and make it effective from retrospective date and grant exemption from a retrospective effect thereby taking away the right of gratuity accrued under 1972 Act and thereby, creating a class within a class. And that subjecting the class to be exempted to the provisions less favourable than the benefits conferred under 1972 Act. It is also the contention that the right accrued in favour of the employees has been taken away from a retrospective date without affording an opportunity of hearing. In substantiation of these submissions, learned counsel for the employees have led us through the benefit towards gratuity computed as per Section 4 of 1972 Act being more beneficial than the gratuity payable under the Pension Rules 1976. Formula provided under the Act of 1972 and one under 1976 Rules for computation of gratuity has been commended at to :: 18 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 bring home the submissions that the gratuity under 1976 Rules is less favourable than under 1972 Act. Decisions in State of Tamil Nadu v. State of Kerala AIR 2014 SC 2407 and B.S. Yadav v. State of Haryana AIR 1981 SC 561 have been relied upon.
16. Jettisoning the contentions, respondents No. 2 to 7 while relying on the powers conferred vide section 5 of 1972 Act on appropriate Government to exempt the establishment from a date not earlier than the enactment, have to submit that it being within the competence of the appropriate government to exempt the respondent from the applicability of the provisions of 1972 Act and having satisfied that the benefit under existing 1976 Rules being more beneficial than the benefits conferred under 1972 Act, the impugned notification does not suffer from the vice of arbitrariness or excessive exercise of delegated powers. Emphasizing that the benefits under 1976 Rules are better than those under the 1972 Act, respondents have placed a comparative chart, which we intend to reproduce at relevant stage while dwelling over the aspect as to whether the gratuity payable under 1976 Rules are more beneficial than 1972 Act. Respondents have placed reliance on Rules 43 and 44 of the :: 19 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 Pension Rules, 1976. And, has relied on the decisions by Patna High Court in Janak Prasad Singh v. Bihar State Electricity Board 2004 (3) LLN 491, Gujarat High Court in Vadodara Mahanagar Palika, Naukar v. State of Gujarat decided on 10.1.2008 and of Punjab & Haryana High Court in Vishwanath v. State of Haryana : C.W.P. No.6479/2009 decided on 27.10.2009. Decision by the Supreme Court in Shree Sidhbali Steels Limited v. State of Uttar Pradesh 2011 (3) SCC 193 is also relied upon to substantiate the contention that it is within the power of the appropriate government to issue exemption notification and also to review the same.
17. The question which arises for consideration is whether it is within the powers of the appropriate Government to issue exemption notification under Section 5 of 1972 Act. And if the answer is 'Yes', whether the said power can successively be exercised by issuing subsequent notification exempting the establishment from a retrospective date. And, whether the date for exemption could be beyond the date when the corporate entity has come into existence. If the answer to these issues are in affirmative, the next question which would arise for consideration is as to whether there is an accrual of vested :: 20 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 right in the employees whose services are transferred to new corporate entities to claim gratuity under 1972 Act and whether the gratuity or pensionary benefits under 1976 Rules are not less favourable than the benefits conferred under 1972 Act.
18. Section 5 of 1972 Act stipulates :
5. Power to exempt. - (1) The appropriate Government may, by notification, and subject to such conditions as may be specified in the notification, exempt any establishment, factory, mine, oilfield, plantation, port, railway company or shop to which this Act applies from the operation of the provisions of this Act if, in the opinion of the appropriate Government, the employees in such establishment, factory, mine, oilfield, plantation, port, railway company or shop are in receipt of gratuity or pensionary benefits not less favourable than the benefits conferred under this Act.
(2) The appropriate Government may, by notification and subject to such conditions as may be specified in the notification, exempt any employee or class of employees employed in any establishment, factory, mine, oilfield, plantation, port, railway company or shop to which this Act applies from the operation of the provisions of this Act, if, in the opinion of the appropriate Government, such employee or class of employees are in receipt of gratuity or pensionary benefits not less favourable than the benefits conferred under this Act.
:: 21 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 (3) A notification issued under sub-section (1) or sub-section (2) may be issued retrospectively a date not earlier than the date of commencement of this Act, but no such notification shall be issued so as to prejudicially, affect the interests of any person.
19. Thus, if sub-section (1) and (2) of Section 5 empowers the appropriate Government to exempt any establishment, factory, mine, oilfield, plantation, port, railway company or shop; any employee or class of employees employed in these establishment(s) from the operation of provisions of Act of 1972; sub-section (3) of Section 5 grafts in appropriate Government to issue such notification even from a retrospective date. Apparently, the powers conferred to the appropriate Government is not only to issue notification for exemption but also to issue the same from retrospective date. Thus, two independent powers are conferred in the appropriate Government. True it may be that the exercise of power under Section (3) of Section 5 may be exerciseable with the issuance of notification under sub-section (1) or sub-section (2) of Section 5, but it delegates powers independent to these powers by making exemption effective from retrospective date. Thus, in a case as the present one, having notified an exemption under :: 22 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 sub-section (1) of Section 5 vide notification dated 27.5.2014, it was still within the powers of the appropriate Government as conferred under sub-section (3) of Section 5 to issue a separate notification specifying the date from which the exemption is granted. In other words, the powers to make the notification effective from a retrospective date does not get exhausted merely because it does not find mention in a notification issued under sub-section (1) or (2) of Section 5, as the case may be. Thus, to exempt the establishment or the employee or class of employees from retrospective date not earlier than the date of commencement of Act of 1972 conferred upon the appropriate Government is supplementary to and additional constituent of power of exemption as conferred under sub-section (1) and (2) of Section 5. Thus, there is no transgression of the powers conferred in the appropriate Government who, at one point of time, issue an exemption notification by making it effective from the date of issuance of notification and at another point of time, issue notification by making the exemption from the date prior to issuance of exemption notification.
20. The issue can also be looked in the context of General Clauses Act, 1897. As the Act of 1972 being a Central Act, the :: 23 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 provisions contained under 1897 Act can be taken aid of Section 14 and 21 of 1897 Act, which stipulate -
14. Powers conferred to be exercisable from time to time. - (1) Where, by any Central Act or Regulation made after the commencement of this Act, any power is conferred, then unless a different intention appears that power may be exercised from time to time as occasion requires.
(2) This section applies also to all Central Acts and Regulations made on or after the fourteenth day of January, 1887.
...
21. Power to issue, to include power to add to, amend, vary or rescind notifications, orders, rules or bye-laws. - Where, by any Central Act or Regulations a power to issue notifications, orders, rules or bye-laws is conferred, then that power includes a power, exercisable in the like manner and subject to the like sanction and conditions (if any), to add to, amend, vary or rescind any notification, orders, rules or bye-laws so issued.
21. These two provisions have been interpreted to mean that "...... when a power is conferred on an authority to do a particular act, such power can be exercised from time to time :: 24 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 and carry with it power to withdraw, modify, amend or cancel the notifications earlier issued, to be exercised in the like manner and subject to like conditions, if any, attached with the exercise of the power." (See. Shree Sidhbali Steels Limited v. State of U.P. (2011) 3 SCC 193, Paragraph 41).
22. Taking any view of the matter, it being within the competence of the appropriate Government to notify exemption and make the exemption effective from retrospective date, the exercise of such power in issuing notifications dated 27.5.2014 and 10.12.2014 cannot be faulted with, as the appropriate Government is empowered in that behalf vide Section 5 of 1972 Act.
23. Next question which crops up for consideration is whether an exemption from the applicability of the provisions of Act of 1972 can be from a date prior to coming into existence of the establishment concerned, because sub-section (3) of Section 5 of 1972 Act enables that a notification under sub-section (1) and (2) can be issued "retrospectively a date not earlier than the date of commencement of this Act".
24. That, being an enabling provision, the exercise of power under Section 5 of 1972 Act has to be within the limits implicit therein. What are these limits ? Close reading of sub-sections (1) and (2) of Section 5 reveals that exemption of an :: 25 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 establishment to which 1972 Act applies, such establishment must, therefore, be in existence. And, even when exempted from a retrospective date, the establishment must be in vogue. For example, in the case at hand, one of the establishments, viz. Madhya Pradesh Power Transmission Company Limited which though came in existence w.e.f. 31.5.2005 because of the restructuring of erstwhile Madhya Pradesh State Electricity Board which was dissolved yet, the Company is exempted from the provisions of 1972 Act w.e.f. 16.9.1972. And though, similar is the case of other corporate entities such as Madhya Pradesh Power Generating Company, Madhya Pradesh Poorva Kshetra Vidyut Vitran Co. Ltd., Madhya Pradesh Madhya Kshetra Vidyut Vitran Co. Ltd., Madhya Pradesh Paschim Kshetra Vidyut Vitran Co. Ltd. and Madhya Pradesh Power Management Co. Ltd.
which also came into existence w.e.f. 31.5.2005 and are exempted from the date they came into existence. In other words, the notification for exemption of establishment /corporate entity being issued in exercise of powers conferred vide sub-section (1) of Section 5 of 1972 Act and though it empowers the appropriate Government to exempt the establishment even from the date when the Act of 1972 has come into existence, but the same could be only in case the :: 26 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 establishment in question is in existence. In other words, the notification would be effective from and during the period when such establishment exists unless provided to the contrary. It can be argued that since the power vests with the appropriate Government to even exempt the employee(s) from the provisions of 1972 Act and since liability to pay pension to existing pensioners has been conferred on Madhya Pradesh Power Transmission Company Limited after the dissolution of erstwhile Madhya Pradesh State Electricity Board, the notification in respect of this Company be construed as being issued in purported exercise of powers conferred under sub-
section (2) of Section 5 of 1972 Act. Quite true it may be, because of the settled principle that, in case if an order passed in exercise of power, the sources of power is not quoted, it will not invalidate the order if the power can be referred to a jurisdiction which confers validity upon it (for an authority please see M.T. Khan v. State of A.P. (2004) 2 SCC 267 at page 273). However, even if it is to be construed to be a composite notification, under Section 5 of 1972 Act, in that case, it must meet two requirements, viz. (i) the gratuity or pensionary benefit already available to the employees are not less favourable than the benefit conferred by the Act of 1972 :: 27 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 and (ii) that the retrospective exemption should not prejudicially affect interest of any person.
25. Coming to the case at hand, it is not being disputed that, finding the provisions of Act of 1972 more beneficial than the existing gratuity provisions contained in 1976 Rules, the Controlling Authority has been allowing the claim and directing for computation of gratuity in consonance with Section 4 of 1972 Act. That being so, there is accrual of right in the employees/existing pensioners who have been held entitled for the gratuity under 1972 Act as could be taken away from the retrospective date.
26. This issue can be analysed from another angle. The impugned notification exempting the corporate entities from retrospective effect has been issued on the bedrock that the provisions of 1976 Rules were made applicable to erstwhile Madhya Pradesh State Electricity Board and the gratuity and pension component were more beneficial than the gratuity under 1972 Act. However, as noticed above, the aspect as to whether the gratuity under 1976 Rules are more beneficial than under 1972 Act has been the subject matter of scrutiny before the Controlling Authority and the Appellate Authority in umpteen number of cases in past where on adjudication it has :: 28 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 been found that the gratuity under 1976 Rules being less favourable than what is payable under 1972 Act.
27. To overcome these findings justification as to that the gratuity under 1976 Rules is more beneficial, it is being presented as a package comprising of gratuity and pension. A chart has been prepared and filed along with the return to bring home the submissions that benefit under 1976 Rules from its inception has been more than under the Gratuity Act, 1972. To appreciate the contentions, the Chart is reproduced:
COMPARISON OF BENEFITS UNDER GRATUITY ACT 1972 VIS-A-VIS UNDER MPCS PENSION RULES 1976 ADOPTED BY THE COMPANY BENEFIT UNDER GRATUITY ACT, 1972 PAY DRAWN IN Total Pay DA @ 113% Total emol. Gratuity Calculation as per Act Max. Limit of PAY BAND AND (One Time) Gratuity up to GRADE (Pay X Length of service X 15)/26 10 lacs 8030(Pay)+1900 9930.00 11220.90 21150.90 439288.00 1000000 (Grade Pay) Class Interest @8.5% 3112.00 IV employee on gratuity Thus employee could get benefit of one time Gratuity of Rs.4,39,288/- for short terms and for long term Rs.3,112/- per month BENEFIT UNDER MPCS PENSION RULES 1976 ADOPTED BY THE COMPANY Calculations made Total Pay DA@113% Total emol. Gratuity calculation as per pension Rules, 1976 (One Time) (Pay+DA) X 15 days X length of service (Max. 33 years)/30
(i) Gratuity 9930 11220.9 21150.9 3,48,989.85
(ii) Pension per month (Last Pay/2 4,965.00
(iii) DA @ 113% on pension per month 5,610.45
(iv) Total pension per month 10,575.45
(v) Intt.@ 8.5 % on Gratuity 2,472.00 Thus employee could get benefit of one time gratuity of Rs.3,48,989 and :: 29 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 pension of Rs.13,047 per month inclusive of interest of gratuity BENEFIT UNDER GRATUITY ACT, 1972 PAY DRAWN IN Total Pay DA @ 113% Total emol. Gratuity Calculation as per Act Max. Limit of PAY BAND AND (One Time) Gratuity up to GRADE (Pay X Length of service X 15)/26 10 lacs 15050(Pay)+2300 18850 21300.5 40150.5 8,33,895 1000000 (Grade Pay) Interest @8.5% 5,907 Class III employee on gratuity Thus employee could get benefit of one time Gratuity of Rs.8,33,895/- for short terms and for long term Rs.5,907/- per month BENEFIT UNDER MPCS PENSION RULES 1976 ADOPTED BY THE COMPANY Calculations made Total Pay DA@113% Total emol. Gratuity calculation as per pension Rules, 1976 (One Time) (Pay+DA) X 15 days X length of service (Max. 33 years)/30
(i) Gratuity 18,850 21,300.5 40,150.5 6,62,483.25
(ii) Pension per month (Last Pay/2 9,425.00
(iii) DA @ 113% on pension per month 10,650.25
(iv) Total pension per month 20,075.25
(v) Intt.@ 8.5 % on Gratuity 4,693.00 Thus employee could get benefit of one time gratuity of Rs.6,62,483 and pension of Rs.24,768/- per month inclusive of interest of gratuity BENEFIT UNDER GRATUITY ACT, 1972 PAY DRAWN IN Total Pay DA @ 113% Total emol. Gratuity Calculation as per Act Max. Limit of PAY BAND AND (One Time) Gratuity up to GRADE (Pay X Length of service X 15)/26 10 lacs 25300(Pay)+5400 30,700 34,691 65,391 13,58,121 1000000 (Grade Pay) Class Max. Payable 10,00,000 II Interest @8.5% 3,112 on gratuity Thus employee could get benefit of one time Gratuity Rs.10,00,000/-
for short term and for long term Rs.7,083/- per month BENEFIT UNDER MPCS PENSION RULES 1976 ADOPTED BY THE COMPANY Calculations made Total Pay DA@113% Total emol. Gratuity calculation as per pension Rules, 1976 (One Time) (Pay+DA) X 15 days X length of service (Max. 33 years)/30
(i) Gratuity 30,700 34,691 65,391 10,78,951.50 Max. Payable 10,00,000.00
(ii) Pension per month (Last Pay/2 15,350.00
(iii) DA @ 113% on pension per month 17,345.50 :: 30 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15
(iv) Total pension per month 32,695.50
(v) Intt.@ 8.5 % on Gratuity 7,083.00 Thus, employee could get benefit of one time gratuity of Rs.10,00,000/- and pension of Rs.39,779/- per month inclusive of interest of gratuity
28. To justify the exemption from retrospective date, it is contended on behalf of respondents that under the Act of 1972, the employees are entitled only of gratuity whereas under the Rules of 1976 they, besides gratuity, are entitled for the pension which is paid lifelong. Taking an employee's service span of 35 years, it is urged that under the Act of 1972, a Class IV employee gets one time gratuity of Rs.4,39,288/- and if divided in terms of future benefits he gets Rs.3,122/- per month. Similar breakup has been given in respect of Class III and Class II employees. As evident, comparison has been drawn in case of an employee governed by Rules, 1976.
29. However, evidently while computing benefits under 1976 Rules, three factors are taken into consideration; viz., gratuity (as provided under Rule 43(1) of Rules, 1976), Pension (as provided under Rule 43(2) and Commutation of pension (as covered under Madhya Pradesh Civil Services (Commutation of Pension) Rules, 1996 (which in turn replaced M.P. Civil Services :: 31 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 (Commutation) Rules, 1976). Reliance is placed on the decision by a Division Bench of Patna High Court in Janak Prasad Singh v. Bihar State Electricity Board 2004 (3) LLN 491, the decision is followed by Punjab and Haryana High Court in Vishwanath v. State of Haryana 2009 SCConline P&H 10012 and by Gujarat High Court in Vadodara Mahanagarpalika Naukar v. State of Gujarat.
30. The judgment in Janak Prasad proceeded with the facts as borne out from paragraphs 16, 17, and 18 that in Bihar Electricity Board Workmen were earlier paid gratuity in terms of Payment of Gratuity Act and it was on account of persistent demand raised through the representatives employees Union that the Board ultimately agreed to pay monthly pension by adopting Bihar Pension Rules which was a package for payment of gratuity to the employees (under Rule 27 of the Pension Rules pension includes gratuity). The Court thus found that the pension package available under the Bihar Pension Rules provides a better support system to the retired officer/ employees and their dependents unlike the benefits conferred by the gratuity Act. In the case of Vishwanath (supra), the :: 32 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 Division Bench of Punjab and Haryana High Court while dwelling on the challenge to an exemption notification took into consideration the fact that the employee therein was a member of CPF Scheme and obtained his due amount to which the employer has also contributed by the giving matching grant and that if all retiral benefits are taken into account then the amount of gratuity which become payable under the Act of 1972 would be for less than those benefits. Though in this case specific provisions of Service Rules are not spelt out, however, it is gathered from the decision that this case also, as in the case of Bihar Electricity Board, other retiral dues such as contributory pension was clubbed with the gratuity to ascertain the aspect as to whether the exemption notification from a retrospective date would prejudicially affect the interest of any person. Similar is the view of Gujarat High Court in Vadodara Mahanagarpalika Naukar (supra).
31. In the case at hand, the Rules adopted by the respondents are "The Madhya Pradesh Civil Services (Pension) Rules, 1976".
32. Under Rule 2(i) the expression "Gratuity" includes: (1) :: 33 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 'Service Gratuity" payable under sub-rule (1) of Rule 43; (2) "Death-cum-Retirement Gratuity" payable under sub-rule (1) of Rule 44 and (3) "Residuary gratuity" payable under sub-rule (2) of Rule 44.
33. Under Rule 2(n) expression "Pension" includes: "Gratuity except when it is used in contradistinction to gratuity".
34. Thus, the gratuity though payable under the Rules of 1976 but it is an entity different than pension. Because, while pension is payable on completion of qualifying service of 10 years as provided under Rule 43 (2) of 1976 Rules, the gratuity is payable before completion of qualifying service of ten years as per computation under sub-rule (1) of Rule 43 of 1976 Rules. Whereas, death-cum-retirement gratuity is payable to an employee who has completed five years' qualifying service and has become eligible for service gratuity or pension under Rule 43 on his retirement equal to 1/4th of his emoluments for each completed six monthly period of qualifying service, subject to maximum of 16½ times the emoluments.
35. In other words, an employee completing qualifying service of ten years would be entitled for pension calculated as :: 34 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 per sub-rule (2) of Rule 43 and Death-cum-Retirement Gratuity calculated as per sub-rule (1) of Rule 44. Whereas, an employee having less than 10 years of qualifying service is entitled for gratuity as per sub-rule (1) of Rule 43 and Death- cum-Retirement Gratuity as per sub-rule (1) of Rule 44 if has completed 5 years of service. The Rules of 1976 does not, therefore, aim at treating gratuity and pension as one.
36. In Union of India v. All India Services Pensioners' Association AIR 1988 SC 501, reiterating the law laid down in State Government Pensioners' Association v. State of Andhra Pradesh (1986) 3 SCC 501, it has been held by the Supreme Court: "From the foregoing it is clear that this Court has made a distinction between the pension payable on retirement and the gratuity payable on retirement. While pension is payable periodically as long as the pensioner is alive, gratuity is ordinarily paid only once on retirement."
37. In State of U.P. v. U.P. University Colleges Pensioners' Association (1994) 2 SCC 729, it has been held:
13. Before we express our views on the aforesaid matter, we would deal with the submission of Shri :: 35 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 Jain that gratuity has to be taken as a part of pension, to support which contention our attention has been invited to this Court's judgment in Jarnail Singh case'. Perusal of that judgment shows that gratuity was taken to be a part of pension because of the definition of "pension" as given in clause (o) of sub-rule (i) of Rule 3 of Central Civil Services (Pension) Rules, 1972. It is because of this definition that the case of D.V. Kapoor v. Union of India [(1990) 4 SCC 314] in which it had been held that gratuity was not a part of pension, was not followed, as the Bench which decided that case had not been referred to the aforesaid definition of pension. Similar observation was made in Jarnail Singh case' regarding F.R. Jesuratnam v. Union of India [1990 Supp SCC 640] wherein also gratuity was not regarded as part of pension without noting the abovenoted definition.
14. To buttress his aforesaid submission, Shri Jain also refers to clause (17) of Article 366 of the Constitution which has defined pension to include gratuity. Merely because what has been stated in clause (17) it cannot be held that gratuity has to be taken always and for all purposes as part of pension, because this definition apparently has enlarged the meaning of the word "pension" by stating that this would include gratuity. It is well known that legislature very often wants to give enlarged meaning :: 36 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 to a particular word and this is done by stating that the defined word would include some named related subjects also.
15. We, therefore, state that either because of what was stated in Jarnail Singh case or the way "pension" has been defined in the Constitution, it cannot be held that pension and gratuity are conceptually same, as stated in paragraph 9 of Jarnail Singh case' to which our attention is invited by Shri Jain. According to us, this Court took the view in question in Jarnail Singh because of the definition of the word "pension" in the concerned rule; otherwise, what was held in D. V. Kapoor and F.R. Jesuratnam cases seem to be correct legal position."
38. In Municipal Corporation of Delhi v. Dharam Prakash Sharma (1998) 7 SCC 221) while dwelling on the issue whether an employee of the Municipal Council Delhi would be entitled to payment of gratuity under the Payment of Gratuity Act when the MCD itself has adopted the provisions of the CCS (Pension) Rules, 1972, whereunder there is a provision both for payment of pension as well as of gratuity, it is held:
"......... The Payment of Gratuity Act being a special provision for payment of gratuity, unless there is any provision therein which excludes its applicability to an employee who is otherwise governed by the provisions of the Pension Rules, it :: 37 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 is not possible for us to hold that the respondent is not entitled to the gratuity under the Payment of Gratuity Act. The only provision which was pointed out is the definition of "employee" in Section 2 (e) which excludes the employees of the Central Government and State Governments receiving pension and gratuity under the Pension Rules but not an employee of the MCD. The MCD employee, therefore, would be entitled to the payment of gratuity under the Payment of Gratuity Act. The mere fact that the gratuity is provided for under the Pension Rules will not disentitle him to get the payment of gratuity under the Payment of Gratuity Act. In view of the overriding provisions contained in Section 14 of the Payment of Gratuity Act, the provision for gratuity under the Pension Rules will have no effect. Possibly for this reason, Section 5 of the Payment of Gratuity Act has conferred authority on the appropriate Government to exempt any establishment from the operation of the provisions of the Act, if in its opinion the employees of such establishment are in receipt of gratuity or pensionary benefits not less favourable than the benefits conferred under this Act. Admittedly MCD has not taken any steps to invoke the power of the Central Government under Sectopm 5 of the Payment of Gratuity Act. In the aforesaid premises, we are of the considered opinion that the employees of the MCD would be entitled to the payment of gratuity under the Payment of Gratuity Act notwithstanding the fact that the provisions of the Pension Rules have been made applicable to them for the purpose of determining the pension.
Needless to mention that the employees cannot claim gratuity available under the Pension Rules. ."
39. In the case at hand, though an untiring effort has been :: 38 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 made on behalf of respondents to establish that the provisions under the Rules of 1976 are more beneficial than that of 1972 Act but by clubbing the gratuity and pension; however, since the two are different entities, respondents have utterly failed to establish that the gratuity payable under Pension Rules, 1976 are more beneficial than payable under 1972 Act. And since by virtue of Section 14 of 1972 Act the provisions therein have an overriding effect, the accrual of right to receive gratuity under 1972 Act cannot be taken away from the existing pensioners even if it is within the powers of the appropriate government to cause exemption from a retrospective date.
40. The next issue for consideration is that whether the impugned notification takes away the vested right said to have accrued in favour of existing pensioners. In order words, whether the retrospective operation would have an adverse effect over the right of existing pensioners for a gratuity under the Act of 1972.
41. As has been observed in Chairman, Railway Board v. C.R. Rangadhamaiah (1997) 6 SCC 623 that "20. .. but a rule which seeks to reverse from an anterior date a benefit which has been granted or availed of, e.g., promotion or pay :: 39 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 scale, can be assailed as being violative of Articles 14 and 16 of the Constitution to the extent it operates retrospectively".
42. In State of Gujarat v. Raman Lal Keshav (1983) 2 SCC 33, while striking down 1978 Amendment in Gujarat Panchayat Act, 1961 which extinguished the status of ex- ministerial employees allocated to Panchayat Service as Secretaries, Officers and Servants of Gram and Nagar Panchayats as government servants, it was held by the Supreme Court -
"52. The legislature is undoubtedly competent to legislate with retrospective effect to take away or impair any vested right acquired under existing laws but since the laws are made under a written Constitution, and have to conform to the dos and don'ts of the Constitution; neither prospective nor retrospective laws can be made so as to contravene Fundamental Rights. The law must satisfy the requirements of the Constitution today taking into account the accused or acquired rights of the parties today. The law cannot say twenty years ago the parties had no rights, therefore, the requirements of the Constitution will be satisfied if the law is dated back by twenty years. We are concerned with today's rights and not yesterday's.
A Legislature cannot legislate today with reference to a situation that obtained twenty years ago and ignore the march of events and the constitutional rights accrued in the course of the twenty years.
That would be most arbitrary, unreasonable and a negation of history."
:: 40 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15
43. In Salabuddin Mohamed Yunus v. State of A.P. 1984 (Supp) SCC 399, while striking down the amendment in the relevant Rules applicable to employee in the service of former Indian State of Hyderabad prior to coming into force of the Constitution of India, which was effective from a retrospective date by substituting "Rs.857.15 a month" in place of "Rs.1000 a month" in clause (b) of sub-rule (1) of Rule 299 being violative of Article 31(1) and 19(1)(f) of the Constitution, it was held that -
"6. .. The fundamental right to receive pension according to the rules in force on the date of his retirement accrued to the appellant when he retired from service, By making a retrospective amendment to the said Rule 299(1)(b) more than fifteen years after that right had accrued to him, what was done was to take away the appellant's right to receive pension according to the rules in force at the date of his retirement or in any event to curtail and abridge that right, To that extent, that said amendment was void"
44. In C.R. Rangadhamaiah (supra), it has been observed
-
"24. In many of these decisions the expressions "vested rights" or "accrued rights" have been used while striking down the impugned provisions which had been given retrospective operation so as to have an adverse effect in the matter of promotion, seniority, substantive appointment, etc. of the employees. The said expressions have been used in the context of a right flowing under the relevant rule which was sought to be altered with effect :: 41 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 from an anterior date and thereby taking away the benefits available under the rule in force at that time. It has been held that such an amendment having retrospective operation which has the effect of taking away a benefit already available to the employee under the existing rule is arbitrary, discriminatory and violative of the rights guaranteed under Articles 14 and 16 of the Constitution. We are unable to hold that these decisions are not in consonance with the decisions in Roshan Lal Tandon AIR 1967 SC 1189, B.S. Yadav AIR 1969 SC 118 and Raman Lal Keshav Lal Soni (1983) 2 SCC 33.
45. There is another reason why the impugned notification will exclude the persons in whose favour there exist decision by the Authorities under 1972 Act of receiving gratuity thereunder and such decision having attained finality. In State of Tamil Nadu v. State of Kerala AIR 2014 SC 2407, it is held :-
"146. ... Once a judicial decision on ascertainment of a particular fact achieves finality, we are afraid the legislature cannot reopen such final judgment directly or indirectly. In such cases, the courts, if brought before them, may reopen such cases in exercise of their own discretion."
46. To sum up, though we uphold the competence of the appropriate Government to issue a notification of exemption as also notifying exemption from a retrospective date. However, the notification dated 10.12.2014 since does not meet out the :: 42 ::
W.P. Nos.2315/15(S), 2544/15, 13958/15, 13959/15, 13961/15, 13963/15, 13965/15, 13969/15, 13973/15, 13976/15, 13977/15, 13978/15, 13981/15, 13982/15, 13983/15, RP No.554/15, W.P. Nos.13995/15, 13997/15, 13998/2015, 14001/15, 14003/15, 14005/15, 14006/15, 14007/15, 14009/15, 14011/15, 14012/15, 14014/15, 14019/15, 14021/15, 14024/15, 14025/15, 14028/15, 14029/15, 14032/15, 14035/2015, 14036/15, 14554/15, 17404/15, 17405/15 and W.P. No.17407/15 twin safeguards, viz. that the gratuity or pensionary benefit already available to the employees is not less favourable than the benefit conferred by the Act of 1972 and that the retrospective exemption should not prejudicially affect interest of any person. We hold that the notification will not nullify nor take away the effect and benefit of the orders passed by the Authorities under 1972 Act. Nor will it take away the right of the employees, including the existing pensioners, of gratuity under 1972 Act.
47. The petitions are finally disposed of. However, no costs.
(A.M. KHANWILKAR) (SANJAY YADAV)
CHIEF JUSTICE JUDGE
vivek tripathi/
vinod