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Judgment
K.P. Sivasubramaniam, J.—The petitioner/Management of the Lakshmi Vilas Bank, seeks for the issue of a writ of certiorari to call for the
records relating to the order of the Industrial Tribunal/first respondent in I.D.No.78 of 1995 dated 20.11.2000 and to quash the same.
The petitioner contends that it is a Banking Company having its registered office at Kathaparai near Karur with branches and offices located at
various Cities, Towns and Villages through out the country. The wages and allowances and other service conditions are governed by Sastry
Award, Desai Award and settlements made under the provisions of the Industrial Disputes Act. On 29.6.1990, an industry wise settlement was
entered into and applicable to the petitioner and its workmen. The settlement provides for payment of House Rent Allowances (H.R.A.) at 6.5 per
cent of basic pay for an area with a population of less than 10,000, House Rent Allowance (H.R.A.) at 8 per cent of basic pay for an area with a
population 10,000 and above, but less than two lakhs and House Rent Allowance (H.R.A.) at 10 per cent of basic pay for an area with a
population of more than 2,00,000.
The management further contends that prior to 1992, the Head Office was functioning at Karur which had a population of more than 10,000,
but less than two lakhs. Therefore, the staff were getting H.R.A. at 8 per cent of their basic pay. In the year 1992 the Head Office was shifted
from Karur town to a nearby village Kathaparai where the population was less than 10,000. Accordingly, the staff were only entitled to H.R.A.6.5
per cent of the basic. In terms of the settlement, the staff are also liable to be transferred within the same area and when such transfer takes places,
they can draw allowances only at the rate applicable to the area in which the office is located.
Therefore, according to the petitioner, when the office was shifted from Karur to Kathaparai in 1992, the staff made a representation that by
reason of their transfer they will be entitled to only 6.5 per cent as against 8 per cent H.R.A. and therefore, the management should consider some
relief. The Board of Directors passed a resolution permitting to allow the staff to draw H.R.A. at 8 per cent and as a gesture of goodwill, the
management also continued the allowance at 8 per cent on the clear understanding that the concession will not be extended beyond 31.3.1994.
This was made clear to all the staff. Though the agreement clearly provided for fixation of H.R.A. as aforesaid, by way of abundant caution on
28.2.1994 the petitioner gave a notice u/s 9-A of the Industrial Disputes Act conveying that the staff would receive H.R.A. only at 6.5 per cent of
their basic pay as and from 1.4.1994. Aggrieved by the same, Union raised an industrial dispute. The dispute was referred to the Industrial
Tribunal. The Tribunal/the first respondent passed an award on 20.11.2000, holding that the ruling of the High Court/Division Bench in the case of
CHERAN TRANSPORT CORPORATION v. UNION OF INDIA (W.A.No.1503 of 1991 dated 1.12.1997) was applicable to the facts of
the case and the award was granted in favour of the workers. Hence the above writ petition.
I have heard learned counsel for the petitioner/management. Learned counsel contends that the terms of the settlement between the management
and the employees u/s 18(1) of the Industrial Disputes Act dated 29.6.1990 were clear and the workers were bound by the terms which included
percentage of H.R.A. as applicable to the staff working in different towns and villages. Bipartite settlement was also entered into specifically with
regard to H.R.A. and also policies regarding transfers. The petitioner Union being a party to the said settlement, they cannot now make a claim
contrary to the said settlement. Even though in view of the said settlement there was no necessity to give notice u/s 9-A, the management had by
abundant caution given notice u/s 9-A of the Act. Therefore, the petitioners cannot allege violation of any of the provisions of the Act or non-
compliance of Section 9-A of the Act.
Learned counsel further contends that the Industrial Tribunal ought not to have strayed beyond the scope of the clear settlement between the
parties. There is no factual dispute over the position of the office in which the petitioners were working, was situate at Kathaparai, a village where
the population does not exceed 10,000. Therefore, in terms of the settlement, the petitioners were entitled to H.R.A. only at the rate of 6.5 per
cent. Policy regarding transfer was also clear and the transfer of the petitioner from Karur to Kathaparai cannot be questioned. In fact, the Union
does not challenge the power of the administration to transfer the petitioners. That being so on the face of the transfer of the petitioners from Karur
to Kathaparai, the rate of H.R.A. would be applicable only as payable to the staff at Kathaparai. In fact, there is a local branch at Kathaparai who
are paid H.R.A. only at the rate of 6.5 per cent. There cannot be any discrimination between two sets of employees who are working in the same
station. Therefore, the decision of the Industrial Tribunal was liable to be set aside.
Mr. D. Hariparanthaman, learned counsel for the second respondent contends that the Administrative Office of the Bank was originally
functioning at Karur. It was subsequently shifted to Madras in the year 1974. The Administrative Office again shifted back to Karur during the year
1982. In fact at that time the petitioner Union had protested to the Bank against the decision of shifting the Administrative Office. It was pointed
out by the Union in their letter dated 14.3.1982 that the employees have to face several difficulties due to the shifting. However, the management in
spite of the protest from the staff shifted the Administrative Office to Karur. It was agreed that unwilling employees should not be transferred and
that those employees who are shifted should not be subjected to any disadvantages with reference to the wages and allowances. The Bank had
agreed for the proposal and Administrative Office was functioning from 1983. Learned counsel further states that when the office was at Karur
employees were getting 8 per cent H.R.A. The management took a decision for administrative reasons to put up the Administrative Office at
Kathaparai, a village adjacent to the Municipal office. Learned counsel further contends that the village is situate outside the Municipal limits of
Karur but forms part Urban Agglomeration of Karur. The management took a decision to reduce the rate of H.R.A. to the detriment of the
workers. Immediately after the notice u/s 9-A of the Act, the petitioner raised an industrial dispute. Learned counsel therefore, contends that the
series of events will disclose that the Administrative Office of a large bank, which was once located at Madras was shifted to Karur and then again
shifted to Kathaparai. The shifting of Administrative Office at Kathaparai was to enable the bank to put up a larger Administrative Office which
was not possible to be located within the Municipal area of Karur. As such, the Administrative Office was constructed at the outskirts of Karur.
The employees attached to the Administrative Office perform different functions and the nature of their work cannot be compared with the work of
the staff attached to a small branch office which is situate at Kathaparai. Therefore, the Tribunal had rightly taken into account the plight of the
petitioners employed and had answered the award in favour of the employees. The Tribunal also rightly relied on a decision of the employees in
W.A.No.1503 of 1997.
In reply, learned counsel for the petitioner management contends that the facts relating to the W.A.No.1503 of 1997 is totally different. In the
present case, the issue of transfer as well as rate of H.R.A. are specifically governed by Bipartite settlement and also a settlement u/s 18(1) of the
Act dated 29.6.1990. The above said writ appeal was a case of amalgamation of different establishments resulting in change of Headquarters of
the newly created Company. Therefore, the Division Bench had expressed that the terms of the settlement was not relevant and what was relevant
was the consequences of the amalgamation and the change in the Headquarters of the Company. On facts, the Division Bench found that the
proposed change was in utter disregard and gross violation of terms and conditions of amalgamation. It was also found that the condition of
amalgamation gave protection and safeguard to the existing benefits and service conditions. Therefore, the reference to the judgment of the Division
Bench of this Court, was not correct.
I have considered the submissions of both sides. Though it is true that the Tribunal has heavily relied on the decision of the Division Bench of this
Court in W.A.No.1503 of 1997, it is not necessary to refer to the facts under which the said decision was rendered even as the learned counsel
for the petitioners has pleaded that the issues raised in this writ petition could be independently considered.
It is needless to mention that the Administrative Office of the respondent/Bank is equivalent to a Head Office of the Bank. There is no dispute
over the fact that the Administrative Office was once situated at Madras and later shifted to Karur. The objection by the staff for such shifting is
also not in dispute. Further, shifting from Karur to Kathaparai was due to administrative exigencies of finding a proper place and space for putting
up a bigger complex. As it was found not possible to find a proper location, the construction of the Administrative Office had to be necessarily
situated on the outskirts of Karur Municipal limits. That is how the Administrative Office is now stationed at Kathaparai. The nature of the work
executed by the staff of the Administrative Office are the same irrespective of the station where the office is located whether at Chennai, Karur or
at Kathaparai. Therefore, there is no justification for comparing the nature of the work involved in the Administrative Office in contrast with the
branch situated at Kathaparai. Therefore, the contention of the management that there should be payment of uniform H.R.A. for the staff working
at the Administrative Office and the staff working at the branch office cannot be accepted.
Even otherwise, it is seen that admittedly the village Kathaparai is within the Urban Agglomeration of Karur. This fact is admitted by the
management itself in their letter to the Assistant Labour Commissioner (Central), Madras, dated 7.5.1994. It is clearly stated that though
Kathaparai is situate outside the Municipal limit of Karur, the place is contiguous area of Urban Agglomeration of Karur. In fact, only in
appreciation of the said facts, the management itself had been paying H.R.A. at the rate of 8 per cent for a considerable time even after the shifting
of the Administrative Office to Kathaparai. It may be that the staff belonging to the branch office at Kathaparai have also been agitating for the
increase of H.R.A. But that cannot lead to an action by the management to reduce the H.R.A. in favour of the petitioners who are working at the
Administrative Office. It is not for this Court to consider the issue as to whether the employees working at the branch office at Kathaparai would
also be entitled to the allowance at the rate of 8 per cent. In this writ petition, this Court is only concerned with the rights of the staff working at the
Administrative Office which was shifted from Madras to Karur and then from Karur to Kathaparai, and also the fact that Kathaparai falls within
the urban agglomeration area of Karur Municipality. The exigencies of transfer from one branch to another branch cannot be compared with the
shifting of the Administrative Office itself due to administrative reasons as a result of the need to locate the office in a larger building which had
resulted in the shifting of the Administrative Office to the outskirts of Karur Municipal Office. The said event cannot result in any disadvantage to
the staff. The further contention of the employees that there are no housing facilities at Kathaparai and all the employees are residing at Karur is
also not disputed by the management. Therefore, I do not find any reason to interfere with the award which is passed in appreciation of all the
issues which are necessary for a proper adjudication by the Industrial Tribunal.
The writ petition is dismissed. No costs.