Document Fragment View

Matching Fragments

6. We have heard Shri. Ashok B.Shenoy, learned counsel for the petitioners, Shri. P.Ramakrishnan, learned counsel for the State Bank of Travancore and Smt. Shahna Karthikeyan the learned counsel appearing for the Canara Bank.

7. Learned counsel for the petitioners in support of the Writ Petitions contended that benefit of revision of pay scale having been granted with effect from 01.07.1993 and the petitioners having received arrears on the revised pay scale, the said pay scale ought to have been taken into consideration for computation of gratuity. Since the emoluments which is the basis for computing gratuity stood revised, the non-payment of gratuity on the basis of revised pay scale is arbitrary and discriminatory, there is no O.P Nos.3489 & 20427 of 1997 rationale for extending the benefit of revised gratuity only with effect from 01.11.1994 and when the pay scale has been revised with effect from 01.07.1993, all benefits should have been extended from the aforesaid day. It is submitted that computation of gratuity is based on statutory regulations, namely, the 1979 Regulations which Regulations provided for computation of gratuity, hence by a non-statutory order/instrument, the statutory provisions of Regulations for computation of gratuity cannot be modified. Pay revision which was effected on the basis of an agreement can in no manner affect any statutory Regulation. It is submitted that no material has been placed before the Court to the effect that the State Bank of Travancore has amended the Statutory Regulations in accordance with the agreement arrived at, whereas the agreement contemplated amendment in the Statutory Regulations of different Banks. It is submitted that non-payment of gratuity to those who retired between 01.07.1993 and 31.10.1994 and payment of revised gratuity to those who retired after O.P Nos.3489 & 20427 of 1997 01.11.1994 is without any rationale, it is discriminatory, arbitrary and violative of Article 14 of the Constitution of India. Learned counsel for the petitioners in support of the arguments placed reliance on the judgments of the Apex Court in D.S.Nakara v. Union of India ([1983] 1 SCC 305), Chairman, Railway Board and Others v. C.R.Rangadhamaiah ([1997] 6 SCC

623), Syndicate Bank v. Celine Thomas (2005 KHC 1841) and LIC of India v. Retired LIC Officers Association ([2008] 3 SCC 321).

8. Learned counsel appearing for the State Bank of Travancore refuting the submissions of the learned counsel for the petitioners contended that entitlement of gratuity of the petitioners is crystalized on the date of retirement and as per a Statutory Regulation, their gratuity was computed and paid. Subsequent revision of pay scale which was enforced with effect from 01.07.1993 can have no effect on payment of gratuity to the petitioners since the agreement itself fixed a date for extending the benefit of revised O.P Nos.3489 & 20427 of 1997 gratuity, i.e., with effect from 01.11.1994. When the benefits of revision of pay scale, gratuity and other allowance have been given under a negotiated settlement, it is not open for the petitioners to claim benefit of part of the agreement and negate another part of the agreement. The entire settlement has to be accepted in toto. It is submitted that benefit of the 1979 Regulations for computation of gratuity has already been pressed into service while computing gratuity of petitioners and making payment of gratuity to the petitioners on the basis of the existing pay scale. There is no further right in the petitioners to claim redetermination of the gratuity, even if there is any subsequent enhancement in the pay scale. Learned counsel for the State Bank of Travancore further contended that there was amendment also made in the 1979 Regulations incorporating the terms of settlement. However, even if it is assumed that no amendments were carried out within the time, that shall not make any difference regarding the claim of petitioners for revised gratuity. O.P Nos.3489 & 20427 of 1997 Learned counsel for the State Bank of Travancore relied on the judgment of the Apex Court in State Government Pensioners' Association and Others v. State of Andhra Pradesh ([1986] 3 SCC 501), State of Punjab v. Amar Nath Goyal ([2005] 6 SCC 754), State of A.P. v. A.P. Pensioners' Association ([2005] 13 SCC 161) and Sudhir Kumar Consul v. Allahabad Bank ([2011] 3 SCC 486) and the Division Bench judgment of this Court in State Bank of Travancore and Others v. P.Gopinathan Nair and Others (W.A.No.2185 of 2009 decided on 10th June, 2011).

20. As noted above, the issue to be considered in this case is as to whether denial of benefit of gratuity on the basis of revised pay scale with effect from 01.07.1993 to the petitioners is arbitrary, discriminatory and violative of Article 14 of the Constitution of India. Paragraph 15 of Annexure-I to the joint note dated 23.06.1995 provided the date of effect of the extended benefit of gratuity and certain other O.P Nos.3489 & 20427 of 1997 benefits only with effect from 01.11.1994. The petitioners who retired between 01.07.1993 and 31.10.1994 and were denied benefit of re-computation of gratuity have come up in the Writ Petition complaining the action as discriminatory and arbitrary. Division Bench judgment of this Court in Syndicate Bank v. Celine Thomas (supra), the correctness of which is to be examined has held the denial of gratuity based on the revised pay scale as arbitrary and violative of Article 14 of the Constitution of India. The Division Bench held that the mini classification between those who retired between 01.07.1993 and 31.10.1994 and those who retired on or after 01.11.1994 offends Article 14 of the Constitution. In paragraph 13 of the judgment as quoted above, reasons were given by the Division Bench. Another reason given by the Division Bench is that the memorandum of understanding (23.06.1995) cannot meddle with the statutory prescriptions. The Division Bench in Syndicate Bank v. Celine Thomas (supra) was considering the Regulation framed by the Syndicate Bank, O.P Nos.3489 & 20427 of 1997 Regulation 46 of the 1979 Regulations regarding payment of gratuity. After the settlement dated 23.06.1995 Regulation 46 was amended by adding second proviso in the Regulation which has been quoted by the Division Bench in paragraph 5 which has already been quoted.

"6. The claim of Respondent No. 1 was allowed in part by a learned Single Judge of the High Court by his order dated 8th July, 2003 holding:
"A reading of Ext. P3 (instructions issued by the Chairman for supplementary of Revisionist in respect of class I officers and claimed IV will definitely go to show that it cannot operate as far as the claims for gratuity is concerned. It is admitted that at least certain officers, represented by the petitioner Association were deemed as having revised salary from April, 1993 onwards. In that view, at the time of retirement, they were deemed as getting a salary which alone could have been taken notice of for computing gratuity, if Regulation No. 77 has any application. It is definite that the restriction in Ext. P3 and benevolence in Regulation No. 77 could not have coexisted because the Corporation is offering gratuity at the rate less than the amount an employee had notionally drawn at the time of their respective retirement. It is also pertinent to note that when powers were O.P Nos.3489 & 20427 of 1997 conferred on the Chairman under Regulation No. 51(2), specific reference was there about the incidents of DA and other allowances. There is no reference to any alteration permissible in respect of gratuity. It leads to the position that the regulation did not permit the Chairman to disturb criterian for gratuity payment by exercise of powers under Regulation No. 51(2)."