Managing Director, Steel Authority of India Ltd., Bhilai vs Smt. Narmada Bai and Another

Satish K. Agnihotri, J.

The petitioner, by this petition seeks to challenge the validity and legality of the order dated 28.4.1992 (Annexure P/1), passed by the Labour Court, Bilaspur in Case No. 30/I.D.A./89 (Narmada Bai Vs. Steel Authority of India Ltd. Bhilai).

The brief facts in nutshell are that the respondent No. 1 (Smt. Narmada Bai) was appointed in the petitioner organization on 14.6.1978 as Piece Rated Mazdoor. On 29.8.1987 (Annexure P/3) the respondent No. 1 made an application for voluntary retirement under the Voluntary Retirement Scheme No. 9/82 (Annexure P/4-A) (in short, "Scheme No. 9/82"). This Scheme No. 9/82 was extended from time to time by various circulars and lastly it was extended vide circular dated 14.5.1988 (Annexure P/4-G). The application of the respondent No. 1 was accepted in accordance with the Scheme No. 9/82 and she was relieved on 29.8.1987. On the date of voluntary retirement the age of the respondent No. 1 was 34 years and 7 months and the qualifying service was 9 years, 2 months and 13 days. In accordance with the Scheme No. 9/82, the respondent No. 1 was entitled to get compensation equivalent to 15 days average wages for every completed year of service or any part thereof in excess of six months. The respondent No. 1 was paid the entire amount towards C.P.F., Gratuity and SEWA.

It appears that after getting the benefits of voluntary retirement in accordance with the Scheme No. 9/82, the respondent No. 1 filed an application u/s 33(C)(2) of the Industrial Disputes Act, 1947 before the Labour Court, Bilaspur for grant of retirement compensation to the tune of Rs. 63,454.61, in addition to the amount already accepted by her. The ground of challenge by the respondent No. 1 appears to be, that at the time of her voluntary retirement, a new Voluntary Retirement Scheme was introduced vide circular No. M&R-89/96, dated 15.10.1986 (Annexure P/5), but the employer had not granted the voluntary retirement benefits to the respondent No. 1 in accordance with the said scheme. Thus, the respondent No. 1 was entitled to the compensation of Rs. 63,454.61.

The case of the petitioner-employer before the Labour Court was that the Scheme dated 15.10.1986 was not applicable in the case of the respondent No. 1, as it was applicable in cases of only those employees who have completed 40 years minimum age and 10 years of qualifying service.

The Labour Court by impugned order dated 28.4.1992 (Annexure P/ 1) allowed the application filed by the respondent No. 1 holding that the employer on its discretion may grant retirement compensation by relaxing the Rules and as such, directed the petitioner-employer to pay a sum of Rs. 63,454.61/-.

Learned counsel appearing for the petitioner in support of his submission placed reliance on a judgment and order dated 16th September, 2009, passed by this Court in Writ Petition (C) No. 6847 of 2006 (Sarvanand Giri Vs. The Group General Manager, Hindustan Steel Works Construction Limited) and submits that once the proposal for offer of the petitioner -employer for voluntary retirement, in accordance with the Scheme No. 9/82, was accepted by the respondent No. 1 by making the application dated 29.8.1987 (Annexure P/3), thereafter, the same was accepted and the required payments were made, thus, the contract was concluded. It cannot be reconsidered on the basis of a subsequent application, either to the employer or to the Labour Court for grant of benefit of some other scheme, after receiving the benefits as envisages under a particular contractual scheme.

Per contra, learned counsel appearing for the respondent No. 1 supports the impugned order.

I have heard learned counsel appearing for the parties and perused the documents appended thereto.

It is well settled that once an employee has accepted the retiral benefits under voluntary retirement scheme, he cannot resile from its earlier stand as observed by Hon''ble Supreme Court in Bank of India and Others Vs. O.P. Swaranakar etc.,

However, it is accepted that a group of employees accepted the ex gratia payment. Those who accepted the ex gratia payment or any other benefit under the Scheme, in our considered opinion, could not have resiled therefrom. The Scheme is contractual in nature. The contractual right derived by the employees concerned, therefore, could be waived. The employees concerned having accepted a part of the benefit could not be permitted to approbate and reprobate nor can they be permitted to resile from their earlier stand.

This Court in Sarvanand Giri (supra) has held that "It is trite law that if the voluntary retirement has been sought pursuant to some Voluntary Retirement Scheme, the same shall not be governed by the provisions of law but by the terms and conditions of the Scheme."

In HEC Voluntary Retd. Emps. Welfare Soc. and Another Vs. Heavy Engineering Corporation Ltd. and Others, Hon''ble Supreme Court held that unless a statute or statutory provision interdicts, the relationship between the parties to act pursuant to or in furtherance of the voluntary retirement scheme is governed by contract. In para 22 Hon''ble Court held as under:

Financial considerations are, thus, a relevant factor both for floating a scheme of voluntary retirement as well as for revision of pay. Those employees who opted for voluntary retirement, make a planning for the future. At the time of giving option, they know where they stand. At the point of time they did not anticipate that they would get the benefit of revision in the scales of pay. They prepared themselves to contract out of the jural relationship by resorting to "golden handshake". They are bound by their own act. The parties are bound by the terms of contract of voluntary retirement. We have noticed hereinbefore that unless a statute or statutory provision interdicts, the relationship between the parties to act pursuant to or in furtherance of the Voluntary Retirement Scheme is governed by contract. By such contract, they can opt out of such other terms and conditions as may be agreed upon. In this case the terms and conditions of the contract are not governed by a statute or statutory rules.

Having heard learned counsel appearing for the parties and having regard to the afore-stated facts and situation, in the light of various decisions, quoted above, it is held that the respondent No. 1 was entitled to the voluntary retirement benefits only in accordance with the Scheme No. 9/82, as she had submitted her application dated 29.8.1987 under that scheme only. No further retirement compensation could be granted to her in the light of some other scheme.

In view of the foregoing, the petition is allowed. The impugned order dated 28.4.1992 (Annexure P/1) is quashed and set aside. No order asto costs.