Praveen Kumar vs State of U.P. and Others

Heard learned Counsel for parties and perused the records.

This writ petition has been filed to question the validity of an order dated 13.11.2009 passed by respondent No. 3 (Managing Director, U.P. Electronics Corporation Ltd.), whereby petitioner has been relieved from service w.e.f. 13.11.2009, said to be as a result of acceptance of application for voluntary retirement submitted way back on 11.02.2004 and the decision in respect thereof was communicated to petitioner only on 14.12.2007 (However, petitioner has denied to have accepted any such communication).

Petitioner was initially appointed as Assistant Engineer in UPTRON Digital System Ltd. (for short ''the UDSL'') which is a subsidiary of the U.P. Electronics Corporation Limited (for short ''the UPECL''), which is a State Government undertaking in the pay scale of Rs. 550-1100 vide the order dated 30.04.1984. The appointment letter contained an stipulation that the services of petitioner were liable to be transferred temporarily or permanently to any place in India, or to another/other company or corporation associated with the UDSL at the discretion of management. It is also relevant to mention that the services of employee under the UPECL are governed by U.P. Electronics Corporation Ltd. Service Rules (for short ''the Service Rules'') and thus the same was also to apply in the case of employees of its subsidiary companies as well.

Further as per Rule 3(b) of the said service rules, persons on deputation or transfer can also be absorbed in regular service of the Corporation on such terms and conditions as may be offered by the management. In case deputationist officers do not find the terms acceptable, they may be reverted to their parents department. In the present case, services of petitioner were transferred from UPTRON India Ltd. to the UPECL where he was finally absorbed on requisite consent having been given by the managements of both companies. Further vide Rule 13 of the Service Rules, in case of permanent transfer to any other Corporation or Company, the terms and conditions of service as applicable to similar categories of employees under the orders of Corporation are to apply subject to the condition that such terms and conditions as may be applicable shall not be less favourable to the transferee officer than what were being applicable in the service of parent company.

After appointment as Assistant Engineer, petitioner was confirmed on the said post on 1.6.1985, on having successfully completed one year of probation period. In the year 1987 the UDSL along with other three companies were amalgamated to constitute the UPTRON India Ltd. (for short ''the UIL'') and thus the services of petitioner came to be governed under the said rules. However, it continued to be a subsidiary company of the UPECL. Petitioner was promoted to the post of Senior Engineer in the pay scale of Rs. 800-1450 as per order dated 23/24.1.1991 and later to the post of Senior Assistant Manager in the pay scale of Rs. 3000-4500. In the year 1995, he was promoted as Joint Manager in the pay scale of Rs. 3200-5000 on which post, he was confirmed with effect from 1.7.1995. Vide the order dated 21.7.1995, it appears that the services of petitioner were confirmed in respect of both the companies namely the UPECL and the UIL. However, in the year 1994 the financial condition of the UIL had drastically deteriorated, therefore, the company was sent to the Board of Industrial & Financial Reconstruction (for short ''the BIFR'') and was, thus, declared a sick industrial unit. On 22.12.1998, a decision was taken to close down the UIL, therefore, the State Government wrote to all the departments including the department of Electronics clarifying that employees of the UIL may be transferred and sent on deputation to other departments/companies against such posts which were suited to their qualifications and designations. However, on 12.1.1999, Principal Secretary of the department wrote to the BIFR that since the UIL was a State Government undertaking and that State of U.P. has subscribed the entire shares and further that the UPECL is the promoter of the UIL, therefore, the suggestion was given to allow a merger of Computer Consultancy Division, a unit of the UIL with the UPECL towards the proposal of economic viability. Thus, in the year 1999, State Government decided to launch a Voluntary Retirement Scheme (for short ''VRS'') for the employees of the UIL and one such VRS was also available for the employees in the year 2000. However, petitioner did not apply under the scheme of 2000 and thereafter when the scheme was again floated on 5.10.2001, the petitioner applied thereunder. Under that scheme the competent authority to accept VRS was the Managing Director of UIL who, however, did not communicate any decision on VRS application of the petitioner moved on 8.10.2001. Further it appears from the application submitted by the petitioner for voluntary retirement that it was duly forwarded by the Divisional Head of the petitioner''s division to the Managing Director, UIL and it was also recommended that the petitioner may be relieved on 31.12.2001 but since the competent authority did not communicate any decision taken on the application of the petitioner and he was permitted to continue, there was a presumption that till then the voluntary retirement application of the petitioner was not accepted. It would also appear from the pleadings of the writ petition that on 26.07.2002, the Board of Directors of UIL finally resolved to close down the company and as per the resolution of the Board of Directors vide a letter dated 26.11.2001, the State Government directed the Managing Director, UPECL to inform the BIFR about the said decision regarding the closure of UIL which was duly approved by the State Government. Thereafter, on 23.01.2003, the petitioner was transferred as Joint Manager in Computer Consultancy Division in the interest of company''s business. The said concern was only a sister division of UIL but the same was kept alive as per the decision of the company as well as the State Government and it was to be merged with UPECL which was an economically viable solution. The petitioner worked upto 29.03.2005 on the post of Joint Manager, Computer Consultancy Division where he was appointed to function as Divisional In-charge. The nature of work while serving in Computer Consultancy Division assigned to the petitioner was to look after and promote the activities of hardware business of UPECL. Vide order dated 22.07.2005, petitioner''s pay roll and services stood transferred to UPECL. However, due to some administrative exigencies, petitioner''s relationship with Computer Consultancy Division was not severed and his services could not be transferred to UPECL. Moreover, the Managing Director of both the concerns, namely, UPECLand UIL was common and the transfer of petitioner as per the order dated 22.07.2005 would clearly establish that the voluntary retirement application submitted by the petitioner had not been accepted till then. On 16.12.2004, a meeting was held by the Principal Secretary, Information Technology & Electronics for considering the matter of voluntary retirement of the employees of UIL wherein in principle it was decided that the employees who were working on deputation or in some other capacity in other departments may be absorbed in those departments after taking the approval of administrative department. Moreover, on 08.11.2005, a letter was written by the Principal Secretary, Department of Information Technology & Electronics to the other departments of the State of U.P. where the erstwhile employees of UPTRON India Limited were working either on transfer or on deputation or on contract basis to obtain their consent for taking a decision on their absorption in their respective departments and then it was to be informed through the Department of Electronics by 30.11.2005. It also appears that in response to the letter of the State Government dated 08.11.2005 sent by the Principal Secretary, a letter was written by the Managing Director, UPECL on 27.05.2006 to the State Government mentioning therein that at that time there were 11 employees of UIL who were working on transfer of their services to UPECL and the services of such employees were required by UPECL in the interest of organization. However, the said reply would also clarify that UIL had since already been closed down and the services of its employees were not required by other concerns. Moreover, their services had already been placed at the disposal of UPECL where they had been discharging duty assigned to them and the organization was making satisfactory profit. However, during the process of absorption of petitioner and other employees on transfer to UPECL, the petitioner wrote a letter to the Managing Director, UIL, that since in the wake of exigency of work his services were transferred to UPECL and he was continuing to discharge duties there and also drawing salary, and therefore under changed circumstances, he be permitted to continue in service and also sought permission for the withdrawal of application for voluntary retirement. On the said application, the Managing Director, UIL, sought confirmation from the Managing Director of UPECL for taking a decision. Thereafter, on 04.01.2007, the services of the petitioner were absorbed as Manager in UPECL in principle and it was also provided that he will be deemed to be an appointee of UPECL from the date of transfer of his services i.e. 22.05.2005 and also for his past services rendered with erstwhile employer, namely, UIL, he was entitled to get statutory benefits like gratuity etc. Moreover, the decision of absorption of the services of petitioner was taken also in view of No Objection Certificate recorded by the Managing Director of UIL on 08.05.2006 and 02.06.2006 and the absorption was approved by the Board of Directors of UPECL on 08.06.2006 and 12.09.2006 towards compliance of the directions of the State Government. Despite the exercise of absorption being carried out on 12.12.2007, a review meeting of the State Government was held which was chaired by the Principal Secretary, Information Technology & Electronics wherein it was decided that the employees of UIL, who had opted for VRS and whose applications have been accepted, be relieved immediately. Thus, vide a letter dated 14.12.2007, the petitioner was informed that his application for voluntary retirement was accepted on 11.02.2004 and as such he was required to complete necessary formalities.

Shri S.K. Kalia, learned Senior counsel, submitted that looking to the requirement of the scheme, till there was a communication from the competent authority regarding the acceptance of application seeking voluntary retirement, the petitioner was deemed to be in service. Shri Kalia also submitted that in view of the subsequent developments after the submission of application for voluntary retirement and that the case of petitioner was favourably considered for absorption, looking to his utility in the concern, the order of Department impugned herein accepting voluntary retirement of the petitioner retrospectively would amount to non-application of mind, and thus, the order was vitiated and it is a non-est. Shri Kalia also submitted that about a year before the acceptance of voluntary retirement was communicated to the petitioner, the petitioner had submitted an application for withdrawal of the same. Learned senior counsel also referred to a judgment of Hon''ble Supreme Court reported in Shambhu Murari Sinha Vs. Project and Development India and Another, wherein the Hon''ble Court has dealt with effective date of voluntary retirement. According to ratio of the judgment, if an application for withdrawal was made prior to the effective date of voluntary retirement, the employee would be entitled to continue in service with all consequential benefits. Further, as per ratio, an employee is entitled to withdraw the application for voluntary retirement before the communication of decision of acceptance.

Shri Sanjay Bhasin, learned Additional Chief Standing Counsel, also submits that he has received a letter with reference No UPLC:PER:1754/2009 dated 29.04.2010 informing him that the acceptance of the application for voluntary retirement of the petitioner was not communicated prior to his withdrawal of the said application. Though it is a communication between the client and the advocate but since the learned Counsel wants to place it on record, it is taken on record.

Thus, in view of the fact that the petitioner withdrew his application before it was accepted and that position is admitted by the respondents; that the ratio of judgment (supra) of Supreme Court lays down in clear terms that an application for voluntary retirement can be withdrawn before it is accepted, and further that the relevant portion of scheme dealing with the point in question also supports the stand of the petitioner, we are inclined to accept the contentions of learned Sr. Counsel for the petitioner. The relevant extract of the Scheme on reproduction reads as:

The competent authority may accept/reject the application of an employee for voluntary retirement keeping in view of the organizational requirement or any administrative reason and the decision of the Managing Director shall be final. No voluntary retirement shall be deemed to come into effect unless the decision of the competent authority has been communicated in writing.

We thus allow this writ petition and quash the letters dated 11.02.2004, 14.12.2007 and 13.11.2009 communicating to the petitioner about the acceptance of application for voluntary retirement which was admittedly withdrawn before the communication of acceptance was received. Thus, the petitioner would be entitled to continue in service and get all the consequential benefits.

This writ petition is, thus, disposed of.